Line up the kids, set up the blackboard and put the chairs in a semicircle. Financial planning class is about to begin.

In a recent survey of First Command Financial Advisors, one out of five respondents said the single, best piece of advice they would give parents who want to teach their children about finances is to start at an early age. It’s never too early to introduce kids to the world of personal finance. Even very young children can learn basic money skills. Here are a few lesson plan ideas to get you started.

This Little Piggy . . .
Before kids tackle the topic of investing, they need to learn the importance of saving money. One of the simplest ways to teach this is by opening savings accounts for your children. Explain to them that the money they put in the bank earns more money just by leaving it in the account.

Talk About Goals
Suggest that your children save at least part of the cash they get for birthdays and holidays or earn doing chores. Having a specific goal, such as buying a video game or a bike, can make saving easier for kids and encourage them to put money away for the things they want. When children are old enough to learn about investing, not only will they understand the value of saving, but any extra money they’ve saved can be used to buy their first investments.

Got Game?
Most kids like games, so using them to help your child understand financial topics can be fun and instructive. You can find a number of board games at toy and department stores that show how the stock market works. If you have a computer at home, consider searching the Internet for money games that kids can play online. And don’t forget about books. A visit to the library may turn up books on investing written specifically for children in a variety of age groups.

Fun with investing
As your kids get older, introduce them to some simple investing concepts. Tell them that owning a stock means owning a small piece of a company. Open a mutual fund account that’s funded entirely with your child’s money. Consider starting an automatic bank draft on the child’s own bank account and matching his or her deposits with your own. And use the periodic fund statements to teach about dividends, fluctuations in value and the power of compounding.

Remember, though, to carefully review the prospectus for a particular mutual fund investment before purchase, as the prospectus contains important information on costs and risks. Be aware, also, that investment return and principal values will fluctuate over time so that an investor’s shares, when redeemed, may be worth more or less than their original cost.

Spending on a budget
First Command Financial Advisors think that spending without a budget is one of the most important issues plaguing children today. Sixty percent of advisors with children think that this is one of the major financial pitfalls children are susceptible to in the future, and the majority think that spending without a budget is the greatest financial mistake made by both teenagers (72 percent) and children in college or university (78 percent).

You can help your children learn about budgeting and basic financial management through First Command Bank’s First Account, a checking account for 14- to 22-year olds. Parents can use the First Account to teach everyday financial management — for example, by depositing a child's allowance on a regular schedule and encouraging prudent budgeting and spending until the next "payday." When a parent electronically transfers money to the account, funds become available through the MasterCard debit card, providing the convenience of a pre-paid card without fees and expiration dates. Account-holders can deposit gift money and earnings from part-time jobs, and monitor their accounts through OnCommand™, First Command Bank’s free online banking service. And because the First Account is a joint account between parent and child, you're always in control.

Learn more
A number of websites offer helpful information for teaching your child about money and financial responsibility, including:

• Federal Reserve Education
• Institute of Consumer Financial Education
• JumpStart Coalition for Personal Financial Literacy
• U.S. Financial Literacy and Education Commission

The most important lesson of all is to make learning about finances fun.

To learn more about teaching your children about finances, visit www.firstcommand.com/education or talk to your First Command Financial Advisor.