How to teach kids about money - at home, in class and after school (2024)

In a

, I promised to explore ways to talk to your kids about money.

This isn't the end-all, be-all, but I've found some helpful tools. They can be used in classrooms, the home and -- of all places -- after-school programs.

If you're a parent like me, you've probably wondered when you should start doling out an allowance, open your kids' first savings account and warn them about credit cards.

The President's Advisory Council on Financial Capability has suggestions for tackling each topic.

Resources

: President's Advisory Council on Financial Capability website with age-targeted advice.

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: After-school curriculum for K-5 students,

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educational video games.

: Financial education resources,

: Oregon Treasury literacy and financial program for elementary students.

What is the Rule of 72?

Take any interest rate that your money will earn and divide it into 72. The answer tells you how many years it will take to double your investment at that rate.

For example, figure on earning an APY of 7 percent. (If only!) 72 divided by 7 equals 10.3 years.

A 2 percent APY? 72/2 = 36 years.

It's a quick way to emphasize the benefits of compounding interest.

offers a sleek, age-appropriate set of milestones and activities you can use to help improve your child's understanding of money at various stages of life. The site draws upon scores of financial literacy studies and lesson plans, and distills them into one colorful, easy-to-navigate tool.

"There are so many organizations that do this type of thing," said

, a personal finance writer and council member who spearheaded the site's development. "We sort of just picked and chose from that big group."

Words don't do the result justice.

. Click around. Download the poster.

I learned, for instance, that I should talk to my 6-year-old about never giving out her birthdate, phone number or school on a computer.

I should be asking within earshot as I shop for groceries: "Do I need this? Can I borrow it? Will it cost less elsewhere?"

I should be giving her $2 and letting her choose which fruit to buy (exactly what the

).

The site actually never recommends an allowance (see what

). Instead, it suggests talks to have with your kids and hands-on activities involving money.

Why nothing on allowances? Kobliner said she learned while consulting on a Sesame Workshop show called "

" that Sesame Street had never tackled financial topics. "They were very cognizant of not alienating people or children who didn't have money," she said.

Still, there's nothing wrong with talking to a 12-year-old about credit cards, even if yours won't have one for years. Prod your high schooler to open a Roth IRA when he or she gets a first job. While you're at it, introduce them to the magical Rule of 72 (see box to the right).

By day, Paul Nourigat counsels wealthy clients on how to improve their finances, sell their businesses and pass money to heirs.

But for the last several years, using his own time and money, the Portland wealth strategist has aimed his advice to a broader market -- kids and their parents.

"Spending Success" by Paul Nourigat

Since 2010, Nourigat has written, hired artists and self-published six kids' books on financial topics such as saving, giving and debt. He added a graphic novel to the mix this year and packaged his first five titles into a compilation called "Marvels of Money for Kids."

Nourigat launched the effort after watching the pain of the 2008-09 financial crisis. He drew upon personal experiences, education standards and a conviction that our nation's financial wherewithal was in crisis.

"We have a plague in America," he said. "It's destructive to people's lives. It's also destructive to the fabric of America. Seventy percent of our economy is based on consumer purchases. A strong consumer helps make a stronger America."

His books -- all available

and Powells -- spurn corporate sponsorship. They make no mention of his employer, U.S. Bank's The Private Client Reserve. His chief illustrator is his daughter,

. His wife and son help with marketing. He even set up his own publishing company.

"I didn't want, candidly, to have any corporate interest dilute it," he said. "Tons of financial companies will jump on this bandwagon. But I liken that to a liquor commercial reminding people to drink and drive responsibly. It's a mixed message."

This summer, he paid for exhibit space, signage and airfare for his wife, son and daughter to promote the books at the American Library Association's Annual Congress. He later sent 100 copies to libraries nationwide.

Paul Nourigat

The books are getting traction. Oregon Treasurer Ted Wheeler's office bought more than 850 copies of one title, "Spending Success," and will soon send a copy to every public elementary school library in the state.

It's part of the Oregon Treasury's annual Reading is an Investment competition, which rewards 50 young readers with a $500 Oregon College Savings Plan deposit.

Nourigat, meanwhile, is developing online tools for kids, teens and parents at his website, marvelsofmoney.org. He hopes parents and grandparents read his books to their kids and learn something along the way.

"I've obsessed over this," said Nourigat, declining to say how much money he's spent. "I have the ability to communicate complex issues in a way that's easy to understand. I felt I had to step forward."

You might remember

on Oregon's new personal finance standards for public schools, the ones that won't require any testing. That means those lessons will get short shrift compared with tested subjects such as reading and math.

Knowing that teachers are pressed for time, researchers and economics instructors at the University of Delaware and St. Cloud State University in Minnesota have created a tool to catch kids outside the classroom, in after-school programs for grades kindergarten through fifth.

"It's clear now with the situation in our current economy that we need to address some fundamental personal finance skills," said Bonnie Meszaros, associate director of the Center for Economic Education and Entrepreneurship at Delaware, who oversaw the program's development.

"It needs to be a multi-pronged attack," she said. "After school is a perfect time to reach some of these kids."

The resulting 135-page teaching guide, "

requires some prep work. But instructors don't need an economics background to teach it, Meszaros said.

Boy Scouts of America leaders taught the lessons at an inner-city school and at a homeless shelter in Wilmington, Del. Churches could use it, too, she said.

shows kids talking about economic terms -- capital resources as "things that machines make" and goods as "something you can hold in your hand."

The curriculum is free, paid for from a grant by the ING Direct Kids Foundation. You can download it

. Or call the Council on Economic Education at 212-730-7007.

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