Book Review
Title: "PiggyBanking: Preparing Your Financial Life for Kids and Your Kids for a Financial Life"
Author: Jeff Opdyke
Publisher: HarperCollins; 240 pages; $15.99
I had my kids early — many moons ago. What with that and the fact that so many of my professional women compatriots are having kids later than women of earlier generations, many of my close friends are either gearing up to have their first or second baby, or are raising very young "kidlets" as we speak.
Many of my pals fall into the horrid-sounding, but not nearly so bad in real life, "Alpha Mom" psychographic segment: super-smart women who treat the matter of planning for and raising their children with the same level of skill, strategy, intention and intelligence as they have honed in the workplace — but to the 10th power, because these are their kids, after all, not a work project — whom they love almost ferociously.
As both a close friend and a real estate adviser to a number of the Alpha Moms in my life, I’ve seen firsthand the vast variations in the level of planning and preparation that different families put into pre-baby, preschool and pre-college financial planning.
I’ve also seen very few families put any conscious strategy in action around teaching money lessons to their children, except lessons about the importance of a good education and simply teaching by (very good, sometimes) example. As the mother of 17- and 18-year-olds myself, the importance of the kids’ financial education and life preparedness has become critical in my own world.
Given this context, I was delighted to lay eyes on Wall Street Journal columnist Jeff D. Opdyke’s latest book, "PiggyBanking: Preparing Your Financial Life for Kids and Your Kids for a Financial Life." And I was even more delighted at what I found inside — and I mean immediately, inside the front cover!
Opdyke starts off with a bang, listing off his 15 rules, which are really guidelines, for teaching your kids about money and cultivating in them a healthy relationship with money and sound financial habits from a very young age, ranging from allowance guidelines ("should not be so meager that your child is a pauper among peers, nor so generous that your child can easily afford all wants with little financial planning") to more profound, relational money matters ("One of the greatest gifts you can give your child is your own financial self-sufficiency when you’re old.").
Each line item rule foreshadows Opdyke’s deep dive into it later in the book, down to the page number, but for parents with a pressing question or concern it’s a great navigational shortcut to the area in the book which they are likely to find the most useful.
Opdyke then takes a step back, walking through preparing and planning for having children, including estimating the costs of furnishing and caring for a baby — both one-time and ongoing expenses — and covering such important matters as insurance, the decision-making process of whether a couple can afford for one parent to stay at home with the baby, and creating emergency lifelines and even extra income streams.
Paying short shrift, in my opinion, to the longer-term planning of what a family’s expenses will be over the longer term, Opdyke zooms straight to his meaty and useful rules for teaching kids about money.
And these rules are wide-ranging: Opdyke very thoroughly and insightfully covers the topic of teaching children about earning (through allowances, then businesses and jobs) and spending priorities.
It may sound like a helicopter parent’s fantasy, this fixation on allowances, but as Opdyke accurately declares: "Allowances are one of the single best tools parents have when it comes to teaching kids about money."
And he shows you how to wisely wield this weapon against financial ignorance.
The book’s ultimate selling point? Its usability. The book is less than 250 pages — you could read it cover to cover, if you choose, in a couple of hours. But for every rule and guideline Opdyke suggests you pass onto your kids, he provides a very doable action plan for executing this education.
For instance, on investing, not only does Opdyke break down the basic traded-asset types — stocks, bonds and mutual funds — into a single paragraph of plain English for parents who aren’t clear, he also provides a definition of each asset type "in kid terms," which a parent could literally read from to teach their tykes what a mutual fund is, using examples including "hot dog stands" and "Slip ‘n Slides" for illustration.
Opdyke moves on to drill down into how to teach children responsible spending and budgeting, saving, investing, giving and learning. He repeatedly reminds parents of the ultimate aim, which is to teach sound financial lessons and practices, not to flip your kid’s Christmas money into a billion-dollar profit, or otherwise to create a mini-mogul.
The lessons for parents in "PiggyBanking" are simple and actionable, yet cover a surprisingly complete gamut of money matters.
Thus they, and "PiggyBanking" as a whole, succeed at Opdyke’s aim of empowering parents to take steps to provide their children with a sound financial education by avoiding the overwhelm that is often inherent in "how-to" books on child-rearing.
