Bianchi - Blue chip kids: what every child (and parent) should know about money, investing, and the stock market

DAVID W. BIANCHI

Cover image: Kyle Bianchi
Cover design: Susan Olinsky

Copyright 2015 by David W. Bianchi. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.

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Library of Congress Cataloging-in-Publication Data:

Bianchi, David W., 1954
Blue chip kids : what every child (and parent) should know about money, investing, and the stock market / David W. Bianchi.
1 online resource.
Includes index.
ISBN: 978-1-119-05719-2 (cloth); ISBN: 978-1-119-05856-4 (epdf); ISBN: 978-1-119-05855-7 (epub) 1. Finance, PersonalJuvenile literature. 2. InvestmentsJuvenile literature. 3. MoneyJuvenile literature. I. Title.
HG179
332.024dc23

2015001111

To Bernard Darty
who provided the inspiration and encouragement for this book.

BLUE CHIP: one that is outstanding; top quality; an investment grade stock that is considered to be a safe investment based upon its past performance.

Go try to find the smartest boy and smartest girl in a high school class and ask them some questions about money, investing, and the stock market. How much do you think they know about managing money; about buying and selling stocks and bonds; about currencies and exchange rates; about price/earnings (P/E) ratios or puts and calls; about different ways to make money; about credit and debit cards; market share and initial public offerings (IPOs); about compound interest and being long and short stocks; about taxes, options, and index funds; about mortgages and market cap, the Federal Reserve and the Securities and Exchange Commission (SEC); about how to analyze a company; and on and on and on. I guarantee you they know hardly anything at all.

Schools are simply not doing enough to teach kids the financial skills they will need to thrive in the years to come. They are expected to learn it all someplace else. We are turning out book smart kids who know more by the age of 16 than prior generations ever knew at 21, but will they have the financial skills to manage the money they will earn, spend, and invest for the next 50 years? Who is teaching them about that? No one, as far as I can tell, and the research backs this up.

This subject matter does not have to be boring or intimidating or overly complicated. The basic principles are simple and, when presented with simple kid-friendly illustrations, the entire world of money, investing, and the stock market can be opened up to young people everywhere. And, if truth be known, parents will learn a lot too. As one person said, Parents will buy this for their kids but secretly read it themselves; many adults don't know this subject matter either.

This book started out as a modest effort to write a few pages for our 13-year-old son, Trent, so that he would have some basic knowledge of money and investing. What I thought would be 10 pages or so turned into this: 100 topics with 165 illustrations drawn by Trent's high school cousin Kyle. The topics were written with Trent in mind, and that comes through as one reads the book. If you would like to learn more about these subjects, please visit www.bluechipkids.com.

Here we go. Let's take a journey together into the world of money, investing, and the stock market.

In writing this, it quickly became apparent that it was too confusing to always have to reference both males and females, he and she, him and her, every time there was a need to refer to a person. As a result, our editorial board, which consists of an equal number of him and hers, decided that it would be easier to pick one or the other and stick with it throughout the book.

After a coin toss, monitored by a minister, a rabbi, and a priest, heads won and the decision was made to refer to everyone as a male. It was just the way the coin toss worked out and was not meant to suggest that males are any better at any of this than females; they are not. In fact, women may very well be better at it.

The illustrations in this book were created by Kyle Bianchi (age 17) who is an amazingly talented artist. Each illustration was created by him based on e-mail descriptions from me. Kyle quickly grasped the concept for each image and produced exactly what was asked for and he did it all in record time. Thanks, Kyle.

Finally, this book would not have been possible without the ongoing support and encouragement of my beautiful wife and Trent's devoted mother, Julia, who continues to spend all of her time trying to make the world a better place.

BLUE CHIP KIDS, YOU ARE CLEARED FOR TAKE OFF.