Warren Buffett is a legendary investor who started a handful of small businesses as early as the age of six.
As a child, he not only bought a six-pack of Coke for 25Cents and then sold each can for a nickel, but he also sold magazines and gum from door to door. He has always understood the value and importance of money, and now, he’s ready to help parents teach their kids the same thing.
In an interview with CNBC, Buffett said that his father was “his greatest inspiration” because he taught him the value of saving money at a very early age. It was then that Buffett shared his take on parents today and how they are, or rather are not, preparing their children for financial success.
“Sometimes parents wait until their kids are in their teens before they start talking about managing money,” the financial mogul said. “Parents should start teaching their kids about money management when their kids are in preschool,” Buffett continued.
He then went on to state that although most parents understand the importance of teaching their kids about money, they are still falling behind because they fail to do so when their child is much younger. His comments are even backed by a 2018 survey from T. Rowe Price that revealed how 30% of parents surveyed started educating their kids about money when their kids were 15-years-old, while 14% of the parents stated that they never educated their kids about money matters at all.
To ensure that kids began the practice of understanding the importance of financial responsibility and management at an early age, Buffett launched a children’s animated series called “Secret Millionaire’s Club” which features Buffett as a mentor to a group of eager students.
The program tackles issues as they pertain to finances such as how credit works, what it means to invest, and creating money ledgers, to name only a few. Buffett claims that he everything taught in all 26 episodes were things that he taught his own children about money matters. “They are simple lessons meant for business and for life,” claimed Buffett.
In addition to managing money, Buffett also hopes to inspire parents to teach their kids that money can be unpredictable. “Parents have to teach their kids that just because something doesn’t work out the first time doesn’t mean they need to give up,” stated the money tycoon. He hopes that parents will teach their kids how to be creative and how to think outside the box when it comes to facing any and all financial challenges.
For parents that may not be creative themselves, Buffett shares creative activities that can help kids understand financial lessons on his program. One activity involves two jars for kids that parents can provide. One jar is for spending and the other is for saving. When a child makes money from chores or small jobs in the neighborhood, a parent can discuss how they want to divide the money between their savings and spending jars. This is only one activity among many that Buffett shares so that both children and parents can learn the importance of working together in order to ensure financial understanding and success.
Buffett believes that the financial success of any child begins with the involvement of their parents. If a parent teaches the value of creative finances and money management, then a child will have everything they need to be successful in the future.