In 1996, when my oldest grandchild turned 10or moved into double digits, as she saidI made plans to give money to each of my grandchildren when they reached their teenage years. I wanted to teach them a respect for money and how to invest it, but most of all I wanted them to be comfortable with money and investing concepts. I wanted them to know what people were talking about when they discussed emerging markets, rising interest rates, or consumer spending. I wanted them to be fluent in the language of business.
That summer I began to jot down notes to include in a short set of guidelines. My notes expanded over time as I realized that there was more to tell than the actual investment process. I needed to teach them about savings, but I also needed to discuss the concept of money. I wanted my grandchildren to understand some basic things about the economy, to become familiar with terms like inflation and recession and government agencies such as the Board of Governors of the Federal Reserve. I wanted them to know how and why major weather events affect investments. I wanted them to know how to read the stock tables in the Wall Street Journal or the New York Times or online.
My notes continued to grow. By this time I also had a set of cards with definitions. Ive always appreciated glossaries, so I decided I would give my grandkids one too, as well as phone numbers and Web addresses so they could have additional resources at their fingertips. When it was all done, I had a lengthy set of guidelines and a huge pile of scratch-paper notes that totaled a books worth of material. In the process of thinking through and collecting this material, I talked to my friends about what I was doing for my grandchildren. Their response was always the same: When you get the book done, will you give me copies for my kids and one for me? I need to learn about it, too. Thats how this book was created.
I have written for children of that in-betweenor tweenage. Thats the tone. The data is ageless. The Young Investor provides guidance on various types of savings plans and explains the difference between compound and simple interest. I describe Wall Street, the Dow Jones Industrial Average, and the economy. I teach young investors how to read stock and mutual fund tables.