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Interview with Robert Bacarella
Founder the Monetta Funds, Author
Q. Please tell us a little about your background?
A. I have always had an interest in investing. I started an investment club in 1975 with four individuals and $750. The club grew to a partnership and eventually to a mutual fund organization, which I am currently chairman/president. I am very concerned about the financial literacy effort to teach our children about money and recently introduced a Young Investor Fund that will encourage kids to get involved in the savings process.
Q. What drew you to writing about kids and money?
A. A recent national survey testing high school seniors about basic financial literacy facts showed an average score of a dismal 52%…with most students flunking the exam.
Q. Who introduced you to saving and/or money and at what age?
A. My parents did, at around five years old.
Q. Do you have a favorite place or container to save change? If so, would you tell us a little about it?
A. Yes, a large plastic Coca Cola shaped bottle. Each day I would put my loose change in the bottle, and to my surprise when I took the coins to a local bank I had accumulated approximately $1,200 in savings.
Q. What do you think the biggest challenge parents face when it comes to teaching children about money?
A. Getting kids involved in the savings process.
Q. What’s your best tip for parents on teaching children about money?
A. Encourage kids to start collecting something, i.e. baseball cards, Thomas the Engine train cars or coins, which gets them in the habit of accumulating items to reach a goal. This accumulation process easily connects to saving for the things they want.
Q. What’s the biggest mistake you thing parents make when it comes to teaching children about money?
A. They assume kids learn about money through hands-on experience, which fails to develop good attitudes and behaviors.
Q. Are you pro allowance? Briefly why or why not?
A. No, allowances do not instill good financial habits…knowing that they get money every week no matter how they spend it removes an incentive to save.
Q. At what age do you think credit card education should begin?
A. It depends on the child, but the earlier the better. Most kids don’t understand the difference between cash, debit cards and credit cards.
Q. At what age do you think parents should allow children to have a credit card?
A. Credit cards for kids should be used primarily for emergencies and should have a low credit limit. When a child is allowed to go somewhere without their parents is when they should have a credit card.
Q.    If you could only give a child one piece of advice on money, what would it be?
A. Save on a regular basis so that money will begin working for you rather than you always having to work for money.
Q.    What’s your favorite family activity?
A. Attending various sporting events, going out to dinner or to a movie.
Q.    What’s your favorite money quote or saying?
A. My favorite money quotes comes from the movie Wall Street: “Nothing ruins my day more than losses” or “You’re doing good kid, but you gotta keep doing good…”
Q.   Do you have any final thoughts or suggestions for parents when it comes to kids and money?
A. Financial classes don't teach kids about money because they are usually offered to late to change already ingrained behavior and attitudes about money. Introducing children to having and handling their own money should be a primary goal for parents. The core of teaching financial independence is "involvement" in the savings process. The process begins at a young age by first developing a saving habit to reach a concrete goal. Once children learn how to save and reach a goal the next step is to teach them how money can work for them which introduces them to the investment process. Learning these basic financial skills will boost a child's  self-esteem and internal motivation which is critical to their long-term ability to excel and succeed.


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