Month: January 2022

Investing when “Everything Stays”

investing when everything stays
Investing? Everything Stays!

Today’s article is something a little different – something light to send you into the weekend. Yes, it’s another example of teaching your kids about money with television. What if we could take a kids’ song and make it into a money lesson? I didn’t set out to make this happen. However, spending a lot of time with kids and thinking about personal finance often leads to odd combinations.

Or to put it another way, “Something weird might just be something familiar viewed from a different angle.”

My kids love Adventure Time and it’s good for adults to watch as well. Somewhere along the line, I couldn’t follow the story (it’s very weird). However, I enjoyed the songs, particularly the ones from Marceline (Olivia Olson), so I got the soundtrack for the kids. That’s when one song caught my attention in the car. I would later find out that it made the an LA Times list of top songs that make you cry.

Watch this short 90-second “Everything Stays” from the Cartoon Network show Adventure Time:



In case you aren’t able to watch here are some of the lyrics: (It’s much more meaningful in the full context with the music.)

“Everything stays right where you left it
Everything stays
But it still changes
Ever so slightly, daily and nightly
In little ways, when everything stays”

Isn’t that a tremendous description of buy-and-hold investing? Your shares stay, but there are slight daily changes to the value of the shares.

“Go down to the ocean
The crystal tide is raising
waters’ gotten higher as the shore washes out
Keep your eyes wide open, even when the sun is blazin’
The moon controls the tide, it can cause you to drown”

This quote reminds me of watching the warning signs when you own a stock. The last line about the moon controlling the tide is a reminder that the fate of a stock is often out of your hands once you’ve made the decision to buy.

Index funds don’t require you to keep your eyes open. The moon rarely can cause few diversified portfolios to drown.

What did you think? Was this something too weird or familiar when looked at from a different angle? Let me know in the comments.

MoneyTime Review: Teach Your Kids Personal Finance

Money Time
MoneyTime – Personal Finance for Kids

I have two boys, one in the second grade and one in the first grade. My second grader is doing basic math with money at school, things like making change correctly. It’s certainly a good start, it is math disguised as adding and subtracting tens and twenty-fives. My kids learn more about personal finance when I take them shopping and show them how I compare unit pricing on a jar of spaghetti sauce. For the most part, I should be focusing on how to give your child an allowance.

Alas, two of my greatest interests in life are personal finance and my kids… I would inevitably try to combine the two. I can’t teach all personal finance through television. So when I heard that MoneyTime was an online class for teaching kids personal finance, I did a little research and reached out to them to find out more. Every week, I get a dozen or more companies asking me to pitch their product or service. This was one of the few times that I’ve reached out to the company. (You may have noticed that I review very few services.)

MoneyTime Review: The Overview

MoneyTime is designed for kids between the ages of 10 to 14. From their FAQ:

“We’ve found after testing that children below 10 years old found the math to be a little too complex and those above 14 found the graphics of the game to be too childish. That’s why this age range is perfect for MoneyTime.”

My 8-year-old is in challenge math classes at school, so I figure it was worth a shot. All year, he’s been getting extra instruction in school about how to work with computers just in case they have to go to home-schooling. That proved very helpful in getting him going with the basics of navigating the application. They were right about the math though. Early on, there were some multiplication questions. Armed with his Multiplication Machine, he was ready to go. I was always nearby, but he only called on me a couple of times. If I wasn’t a personal finance blogger (and a Tiger Dad) curious to push the age limits, I would wait until age 10 for the kid to get the most out of the classes.

Money Time Screen

The MoneyTime system is broken up into 8 major topics:

  • Topic 1: Earning, saving and interest
  • Topic 2: Employment
  • Topic 3: Managing your money
  • Topic 4: Borrowing money
  • Topic 5: Property
  • Topic 6: Investing
  • Topic 7: Business
  • Topic 8: Protecting your money

Each of those topics is broken up into 4-6 modules or lessons. For example, “Managing your money” has modules of Smart Spending, Budgeting, Banking, and Paying. I’m not sure that a 10-year-old needs to consider employment in topic 2, especially the “resume” module. However, I think it’s based on the outline of “earn, save, invest” in that order.

My son completed the first topic, so this review will be based only on that section. The lower right-hand part of the dashboard gives you a little view on how that went:

MoneyTime Dashboard

If you read from the bottom up, you can see my son got only 67% of the pre-test questions on earning, saving, and investing correct. I was very impressed by this pre-test because had little exposure to some of the topics. I had to remind him a couple of times that he wasn’t expected to know the answers. I used this opportunity to teach him how to eliminate some answers that seemed obviously wrong and then take his best guess of what’s left.

After a module of instruction, there is a 10 question quiz. He got 60%, 90%, and 80% respectively on the earn, save, invest sections. The invest section introduced the difference of compound interest vs. simple interest – a distinction he still talks about today. When it came to the final review test on the topic of saving, earning, investing, he scored a 93%. I expected some improvement because he was learning the material on the test, but this was outstanding.

MoneyTime Keeps Kids Motivated

You may have noticed that my son has an avatar of a weird orange bird superhero. He likes fire-type Pokemon and my theory is that this most closely resembled Blaziken – the fire chicken.

You can spend your earnings (which come from completing modules) on improving your avatar. This was an important motivation for my 8-year-old. He also made investments in education (the stack of books) and investments (the treasure chest). The education helps him earn more as he completes more modules, he’ll earn more. This seems to be a little like the game of life where having a good career helps you earn more from the “Pay Day” spots on the board. His current job as a “trainer” earns $1000 a year. His $5,500 savings is enough to upgrade to Carpenter that would give him a 50% raise per year ($1500).

It’s not clear to me how years pass in this world, but I think it’s because we stopped where we did. My son did one topic (the three modules) over two days during school break. He hasn’t gone back to it since then. I don’t think it is because MoneyTime didn’t have the staying power. Instead, my kids simply don’t have a lot of time with school/homework/karate/cub scouts/etc. I want them to have some unstructured time as well. We should revisit it over the summer. He’ll have more free time and be almost 9 then.

MoneyTime Review: The Conclusion

I gave you our experience with MoneyTime, but I think the company’s professionally-made, less than 90-second, video shows off a little more from a different perspective. It’s worth the quick watch:

There are a couple of online courses for kids and personal finance, but this is the first one I’ve tried. It works very well. Then again, kids’ personal finance education is non-existent, so the bar is very, very low. When I think of what we spend on karate/skiing classes and specialty camps, the value of this education is way, way, off the charts.

This link will give you 25% off bringing your annual membership to $49. That price is current as of this writing (1/26/2022). They have a deal going on now. The pricing used to be $99 a year. If you think it’s something that you might be interested in, I would buy it now. In the interest of full disclosure, I should mention that the company will give me a commission on sales.

Kiplinger’s Tips for Raising Money-Smart Kids

Raising Money Smart Kids

I love whenever anyone’s best tips for raising money-smart kids. However, Kiplinger’s Personal Finance Magazine holds a special place in my heart. I’ve been reading Kiplinger’s since… well, I was a kid. My mother subscribed to it and I was interested. She had explained compound interest to me a long time ago. Back in those ancient days of around 1988, banks paid a real interest rate – around 7-8% if my memory serves. I had some money saved from my paper route and first job at Papa Gino’s Pizzeria, so it seemed like a good idea to learn more about investing worked.

A lot of personal finance is now online (such as this site), but I’ve been a Kiplinger’s subscriber since around college. You can get a couple of years of it for around $40, which is a great deal compared to the cover price of a whopping $6.99. I’m all for recognizing the value of financial advice, but that’s a lot of money for 72 ad-filled pages of often out-of-date information. It shows how difficult the print world is nowadays.

Today, I’d like to cover Kiplinger’s tips for raising money-smart kids, which was spread out over two issues last year. Specifically, I’m talking about Janet Bodnar who runs the Money Smart Women column. Fortunately, the column covers some fathers who have tips about raising money-smart kids too. Personal finance should be something the whole family can be a part of. My family is a real-life example of it… I just happen to have a crazy obsession.

Part 1: Kiplinger’s Tips for Raising Money Smart Kids

In the first article, Janet Bodnar covers What Kids Need to Know About Finances. She’s literally written the book Raising Money Smart Kids, but to be fair there are more than a few books with that title.

The article makes a point that high-net-worth women have jumped into estate planning due to COVID. These families with a lot of money want their kids to know how to take care of it. Maybe we fit that profile too. However, I’m far from the stage of worrying about how my 8 and 9-year-olds are going to manage money years from now. I simply want to help them have a foundation now rather than be disappointed later. It’s what I know and what I’m passionate about, so I might pass that knowledge on.

The article continues that the two most important things to teach are spending and saving. I agree, especially for young kids. Older kids have more opportunities to focus on earning more and investing. That said, I believe that schoolwork comes first, so earning more has to be “work smarter” rather than “work longer/harder.” At least investing can be very quick, setting up an automatic investing plan can be done in just a few minutes.

The next tip was to have younger kids use cash and let older kids use an ATM account attached to a bank – avoid credit cards. This tip is reasonable. Although, I should mention that my kids have been authorized users on my Amazon card for a few years now. They have no idea about it and wouldn’t know where it is or how to use it, but it will help them earn credit whenever they need it.

The final tip was that young kids don’t need to know about the family income. I think that’s obvious. Young children are still learning place value and numbers like hundreds of thousands simply don’t make much sense.

Part 2: Kiplinger’s Tips for Raising Money Smart Kids

As a follow-up to that article, Bodnar shared some reader tips on raising money smart kids.

One reader shared a “parent matching” strategy. That’s where a parent will reward a child for saving with more money similar to how a 401k match works at many companies. Another reader made it simple, “Live below your means.” Finally, one reader stressed the value of saving over earning, because you pay taxes on money earned.

Some readers disagreed with the above tip about not giving kids credit cards. Like me, one reader wanted their children to establish great credit at a young age. Another reader required kids to pay it off in full every month. I love that last tip as it builds a habit and establishes the importance of it before the kids are on their own in college.

Finally, Bodnar recommended two books for helping high school students with investing, The Motley Fool Investment Guide for Teens: 8 Steps to Having More Money Than Your Parents Ever Dreamed Of and How to Turn $100 into $1,000,000: Earn! Save! Invest!. For younger kids, I have my own opinion on the best book to teach kids about money.

Aside from books, I would add a podcast for teens, NPR’s Planet Money’s Summer School on investing.

I found all these reader tips (along with Bodnar’s book recommendation) better than the original article. Over both articles, there are plenty of good tips – definitely worth a few minutes of your time.

The Best Book to Teach Kids About Money

Have you ever heard of If You Made a Million by David M. Schwartz? It’s illustrated by Steven Kellogg who happens to have written and illustrated one of my wife’s favorite books, The Mysterious Tadpole. My wife read it when she was a little girl. Our kids are very familiar with Alphonse.

By now you may have realized that If You Made a Million is not about helping adults understand money. It’s about helping children. But please don’t click away just yet. If there’s one thing I’ve learned over the last 2 years, it’s that adults can learn quite a bit from children’s books.

Let’s dig into what makes If You Made a Million so special. (By the way, I was not paid to write this review. I simply saw it at the library. I will however make a small commission if you purchase the book from the above link.)

If You Made a Million

Before I get started with the review, let’s get a very important number out there: 1989. That’s when If You Made a Million was written. Yes, the book is as old as Taylor Swift. It is also three years older than Your Money or Your Life, which is often considered the first FIRE book. It was also written 6 years before Suze Orman wrote her first book.

Being old doesn’t make things good. (This blog is living proof of that.) Let’s get to the actual content.

Overall, the book takes a child on a journey of earning and spending money. It starts with feeding a fish a penny, which will allow you to buy one of a shyster’s pebbles. It continues to educate children about coins with increasingly more difficult jobs and ways to spend the money. These first few pages are fairly boring, but they go quickly since there’s only a sentence or two on each page. It’s important to build that foundation.

Once you get into earning a dollar, the book tells the story of compound interest. Here’s the first one:

At ten dollars, the compound interest story gets a little more exciting:

At one thousand dollars, the idea of checks and how they work is introduced. It’s simply much easier than carrying around a wheelbarrow of coins or even a bunch of bills.

At fifty thousand dollars, we learn about how mortgages work:

There’s a little more to mortgages. Specifically, it shows how you keep giving money to the bank year after year for 40 years. The illustrations show the old man still physically bringing his check to the bank for his castle payment. It also explains that this time, you are the one paying interest to the bank.

Finally, we get to the FIRE part of the book. It only takes six sentences. The first four are:

“If you have some very expensive plans, you may have to take on a tough job that pays well.
If you think ogre-taming would be an exciting challenge, you can have fun and make a great deal of money, too.
Of course, you may not enjoy taming obstreperous ogres or building bulky bridges, or painting purple pots.
Enjoying your work is more important than money, so you should look for another job or make less expensive plans.”

Remember what I wrote before about adults learning from children’s books? That last sentence is “Exhibit A” of that.

I promised you six sentences. Here’s two more:

Did you catch the financial independence message there? Having that kind of passive income gives you the option to not work at all, but maybe you should choose the work that interests you because doing nothing could be boring.

There’s a quick concluding page after that to get children’s minds thinking about what they’d do if they made a million dollars.

Final Thoughts on If You Made a Million

I found it surprising how well the math from 1989 holds up today. The banks aren’t paying 5.25% interest like the examples. However, we often work with similar (or even larger) interest rates assuming more risk and different asset allocations.

Also, the one million number at the end might not seem like enough today. However, it is $2,034,157.94 in 2018 dollars. You’ll often see $2 million as the target number for FIRE, so the one million number from 1989 is solid.

After the story ends, there’s a significant section of “A Note from the Author.” Here you get about 1500 words on each of the themes in the book: why money, how banks work, interest and compound interest, checks and checking accounts, loans, and income tax.

Finally, there’s a huge explanation of how he calculated some of the amazing numbers used in the book. These are things like a million dollars in pennies will stack 95 miles high and a million dollars in quarters would way as much as a whale. If you love geeky math, this is fun, but you could choose to skip it and still get all the financial lessons.

I loved If You Made a Million so much that I decided to buy it. We’ve read it about every year for a few years now.

Teach Your Kids About Money with Television

Teach Kids About Money With Television

Does it make sense to teach kids about money with television shows? At first, it may make sense to avoid it. Some argue that kids watch too much television these days. It’s good to have limits, but I think television can be a useful tool.
My opinion is, if they are going to watch television anyway, teaching kids financial literacy is a good use of that time. I’ve put together a few shows that can help form (or supplement) their financial education.

Teen Titans Go!

Teen Titans Go! has 7-10 episodes that cover many important personal finance lessons. Since there are more than 300 episodes of Teen Titans Go! use this guide to look up the specific episodes on Hulu.

There are very few other places where you’ll find an entertaining episode about building wealth with rental properties. One episode covers the importance of good credit history and credit score. Another episode teaches the value of money with a weird analogy of bees being the currency – a perfect starter to talk about cryptocurrency. There’s also an episode with an analogy of taking on too much student loan debt to go to the dream college instead of making the fiscally smart decision.

Warren Buffett’s Secret Millionaire Club

Warren Buffett has a cartoon teaching kids entrepreneurial lessons. There are more than twenty episodes of his group of young teens learning money lessons. It’s free to stream on Kartoon Channel at the link above. No subscription service to buy!

School House Rock

Decades ago, School House Rock famously taught millions of kids how a bill became a law and how parts of speech work. I don’t remember seeing their lessons about money, but my local library had a DVD that was pure gold, Schoolhouse Rock: Money.

It’s another great way to teach your kids about money with television and you can watch all 8 money lessons on YouTube! These videos aren’t the best quality.

If you have a Disney+ subscription, you can get perfect quality by looking up School House Rock and skipping to season 6 for all the money lessons. The other seasons cover a variety of different topics that are worth your time too.
If you have a Disney+ subscription, look up School House Rock and skip to season 6 for all the money lessons. (While you are there check out all the other seasons.)

The short songs cover money management, economics, taxes, the national debt, investing in stocks, and dollar-cost averaging. There’s a little history of money, explaining how barter and coins work.

Cha-Ching Money Smart Kids

There’s a very complete curriculum of money education available at Cha-Ching Money Smart Kids. The lessons consist of 3-minute videos and PDFs designed for teachers (classroom activity) and parents (family activity).

Dr. Alice Wilder, the creator, is known for Blues Clues, Tumble Leaf, and Super Why, one of my favorite shows for teaching younger kids how to read.
Forbes gave Cha-Ching Money Smart Kids a good review.

Shark Tank

Older kids may appreciate Shark Tank. While some topics may be boring to kids, there are quite a few episodes with kids who are entrepreneurs. My oldest saw an episode where a kid started a dog treat business that was very successful. He wanted to start cooking right away.

Biz Kid$

Biz Kid$ is a show designed to teach kids everything about personal finance. You can find some clips here. Those clips come with a lesson plan. All the lesson plans are available in English, but some are available in Spanish as well.
There are a few free streaming episodes on Vimeo.
Unfortunately, if you want to watch all the episodes, it is quite expensive. It seems like the pricing is geared towards school districts. Each 28-minute episode costs $5 to buy or $2 to rent. It would cost about $350 to buy all 71 episodes. You can buy a subscription to stream seasons 1-3 for $30/mo. You’d have to buy another subscription to stream seasons 4-6 for another $30/mo.
So if you were really good about binge-watching 71 episodes, you could do it for $60. That’s a tall order.
I haven’t taken the time to watch this series yet, but I hope to at least watch and review the free episodes soon.

The Toy Box

I’ve never seen this show, but I’ve read some interesting things about it. It sounds a little like Shark Tank where kids (and toy experts) are judges of toys. I’m not sure how much personal finance it will teach, but it sounds like it would be a fun show.
You can buy each of the two seasons of The Toy Box for $15 on Amazon. I can’t seem to find it available for streaming on any major platform.

Final Thoughts on Teaching Your Kids Money with Television

There are a lot of resources out there. I think it makes sense to start with the free ones like Warren Buffett’s Secret Millionaire Club. We’ve watched most of them and, while it isn’t our kids’ most favorite show, it’s among their favorite learning shows.