Good books for a child on finance


Do you have a recommendation for a chidren's book on finance and investing in the stock market? My-12-year-old son is intrigued about how the markets work. We went to the bookstore, but the only title listed is no longer in print.

Not many books on investing are written for 12-year-olds. But plenty of resources are available to help young people - and their parents - understand the basics of sound money management, including investing.

First, while your son's interest in investing should be nurtured, the first priority should be to instill good money habits, including saving, spending responsibly and sharing with those less fortunate. Good books I've read in this area include:

The Financially Intelligent Parent: 8 Steps to Raising Successful, Generous, Responsible Children, by Eileen and Jon Gallo (Penguin Group USA), and A Parent's Guide to Money: Raising Financially Savvy Children, by Alan Feigenbaum (Mars Publishing Inc.). Although these books are aimed at parents, 12-year-olds can read and benefit from them.

"Something I've heard repeatedly from educators across the nation is that kids' minds are like sponges and they need to be challenged," said Sam X Renick, founder of a Los Angeles-based company that produces and sells books, music discs and other products that encourage children to save (see Many parents routinely underestimate their children's ability to understand and absorb challenging concepts, he said.

Renick, a former financial adviser, agrees that children - and adults for that matter - should read books on general money management before books on investing. "I think it's crucial that we train ourselves to develop an attitude, mind-set or approach to money even prior to earning or investing it," he said.

"We should commit to always paying ourselves first as a part of that mind-set and philosophy, and envision ourselves as `asset builders,' " said Renick, who is as passionate about this topic as I am. "If we get in the habit of paying ourselves first, we are automatically always on the road to prosperity."

(Paying ourselves first means that, every time we get paid, we set aside a portion for savings and investing.)

On this subject, Renick recommends such classics as The Way to Wealth by Benjamin Franklin ("super common sense that still applies today," he said) and The Richest Man in Babylon by George S. Clason (Signet), which, through a series of parables set in the ancient city, stresses the importance of building wealth systematically.

Other books we both like include the best-seller Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money - That the Poor and Middle Class Do Not! by Robert Kiyosaki and Sharon Lechter (Warner Books Inc.), and The Money Diet: Reaping the Rewards of Financial Fitness, by Virginia Applegarth (Viking Penguin). The entire Rich Dad series, although unconventional in its approach, is written in an engaging manner and raises the all-important question of whom we work for (even if we work for others, we should act as entrepreneurs).

Humberto Cruz is a columnist for Tribune Media Services. E-mail him at

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