How to Teach Your Kids About Money
The youth of America are plagued by shocking financial illiteracy. Most can't balance a checkbook, much less invest wisely. With our apologies to the Wall Street Journal, we present to you a realistic plan for teaching your kids about money matters.
Banks: Give your kid $10. Then have them give the $10 back to you, to hold for them.
"Do you want your $10 now?"
"Yes."
"There's a $10 fee for that," you say, pocketing their $10.
Financial advisors: Give your kid $10. Tell them that, if they like, you can give them some expert advice about what to do with their money.
"Okay."
"Buy Google. My commission is $10," you say, pocketing their $10.
Entrepreneurialism: Give your kid $10. Tell them they can use it to start any business they want.
"How about a candy store"
"Everybody's doing the low carb thing now," you say, pocketing their $10.
The stock market: Give your kid $10. Let them peruse the stock listings. Let them use the money to buy any stock they want. Then wait a few days.
"How much is my stock worth now?"
"Zero," you say, pocketing their $10.
Bonds: Give your kid $10. Tell them you're going to hold it as a savings bond for them, with a set interest rate. Then wait a few days.
"How much is my savings bond worth now?"
"It won't reach maturity for many years," you say, pocketing their $10.
Inflation: Give your kid $10. Tell them to come back after some time has passed, and you'll take them shopping. Then wait a few days.
"Here's my $10. Can we go shopping?"
"Oh, this is practically worthless by now," you say, pocketing their $10.
Retirement: Give your kid $10. Tell them you'll save it for them, for their retirement. Then wait a few days.
"How's my retirement fund?"
"What did I teach you about inflation?" you say, pocketing their $10.
