The Lowry Letter® - 9/27/2025

There are so many “holidays” today that it is impossible to keep track of them all. But we did want to point out “National Daughter’s Day,” which just passed on September 25, and the upcoming “National Son’s Day” on September 28^th. So, this week’s theme is Financial Literacy for Kids.

We are heavily influenced by an excellent parent book, The Gift of Failure. The basic premise is that young people benefit from failure as a learning tool, especially at younger ages. Letting a child fail a test, or even a class, can be a great lesson in reality, especially when it occurs at a time when the stakes are lower.

The same is true for money and investing. Making some low-stakes mistakes provides the pain, but not the permanent damage, that something similar can bring in adulthood. Here are some tools that can help you teach these lessons.

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• This is a nice little video to teach younger kids basic finance vocabulary.

• Our favorite cash management product for kids is Greenlight. Joe Jr. has used it for many years, as it provides a very easy-to-manage debit card for kids. Parents can add or remove funds, restrict how they are used, encourage savings, and even include parent-approved investment options. We don’t have any affiliation with Greenlight or receive any compensation from them.

• College Planning: Does your child know how much money it costs to go to college? Here is some important data: “over the last 20 years, tuition at national universities increased by 144% at private colleges, and 171% at public colleges (out-of-state) and 211% (in-state). According to the National Association of College and University Business Officers, the average cost of college tuition and fees in the 2021-2022 school year for a private college was $38,185. And at a public university? You’re looking at a price range of $10,338 for in-state students and $22,698 for those who live out-of-state.”

Keep in mind, that is just tuition and fees. For in-state schools, room-and-board is a larger expense than tuition. The linked article has some good tips on discussing this major expense with your children.

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Q: You talk about letting kids fail. What is a good example of that idea?

A: We have all experienced buyer’s remorse or spent money unwisely. That can be a great learning experience IF we identify what went wrong and work to avoid it in the future.

Take buying clothes- if your child needs new clothes, let’s say a couple of shorts and a pair of pants, give them a budget and let them work out how to use it. What if they use the whole budget for one item, instead of the 4 needed? Don’t bail them out by buying what they don’t. Let them live with their choices.

Or you can provide them with a monthly budget for something like fun/entertainment-type purchases. If they use all their budget in 10 days on a video game or Starbucks pink drinks, don’t fund extra activities. Let them experience the opportunity cost of having used their money early.

Every child is different, but these are some of the ways you can allow for natural consequences to teach them as they grow, before the stakes are too high.