“It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price.” – Warren Buffett

How much do your children or grandchildren know about money, where it comes from, and how to use it?

I always buy from kids who have the initiative to put up a stand selling just about anything – lemonade, Girl Scout cookies, Boy Scout Popcorn, you name it. They are the business leaders of tomorrow ..

Understanding money, the work required to earn it and the knowledge to manage it, are important parts of any good education. I remember lemonade stands from my childhood. I still use those Lemonade Accounting principles today. When our children were younger, I remember our son mowing neighborhood lawns and delivering Charlotte’s long-departed afternoon paper.

I remember our daughter logging evening hours of babysitting and later working behind the counter at Arthur’s (when it was in Ivey’s, not Belk’s).

These jobs offered an early education on the value of money. But today, for many reasons, it is difficult for children to have most of these experiences. I worry about the loss of knowledge on money and it’s management especially when so many children only see their parents using plastic as currency or aiming their phone at the scanner.

As the adventures of our Granddaddy Days ended, I wanted a new way to stay connected to my grandchildren. Maybe we could learn how money works from the stock market? We could have time together choosing companies, talking about them, and watching our choices be right – or wrong. Of course there’s a big difference between making money from a job and making money from investments. This new idea gave us the opportunity to talk about these differences and the values in each.

In late 2011, I opened trading accounts for all four grandchildren at Charles Schwab. These accounts weren’t some fancy inheritance tax strategy, or college savings accounts, rather small custodial accounts that couldn’t be cashed out until age 21. The goal was education. Each child could make money or lose money – it would be their choices, not mine, driving this bus.

My first suggestion was for them was to think about things they were interested in and choose companies that matched those interests.

Which products or services did they like and use everyday? Entertainment, clothing, sports apparel, and technology were categories in their lives, so they were good starting points. It was okay to have some mutual funds, but choosing individual companies they could understand was the most important factor.

What was the product, how was it sold, was it good or bad for society? Would they be happy working at that company someday? All questions they could understand and discuss with friends.

There was only enough money to buy one or two shares at a time, and that was fine.

Kenny was the first to jump in, maybe because of talking about the idea with his middle school lunch buddies. He started by picking Google, back when they were about one third of today’s value. Along the way, he sold Google to buy uranium and nuclear funds. His latest interest is global logistics, worldwide shipping, air cargo, and airline manufacturers. Kenny is looking longer term at the continued growth of global markets, and when asked about any trade restrictions put in place by the current administration, responds, “All just talk, we’re beyond that. There’s no turning back now.” Kenny’s also the one who’s added the most of his own cash, saying he just doesn’t need more stuff – a chip off the old block.

His older sister, Elizabeth, started by copying some of his picks, then decided she wanted to go her own way – making her own choices. I’m excited about her choosing an index of companies with female CEO’s and Board Members. These companies are shown to have outstanding records of growth and profitability, perhaps because of the longer view and willingness to delay gratification taken by their female senior management.

I confess to pulling the trigger on this choice before Elizabeth was totally committed, but I think it’s a great investment. I even bought some myself.

Ellie wanted her passion for justice to be reflected in her choices. She has chosen companies who care about reducing carbon foot prints by reducing their own greenhouse gas emissions. These companies are doing the right thing, all while running profitable organizations. No matter the industry, it’s a good model for success. It’s also a way for her to put her money where her mouth is. Good play, Ellie. I hope you continue searching out those people and companies doing good in our world – for ALL stakeholders.

James, the youngest, has a buy and hold model with his money in blue chips and the S&P 500. Warren Buffet would be proud.

I’m pleased with how their portfolios align with their personalities. There’s not a share of fossil fuel, tobacco, or firearms in their individual choices. They have joined other investors who are not looking for only the highest financial gains, but also for companies that match their own values.

After five years, their annual rate of return ranges from seven to thirteen percent. The Dow’s performance during those years is annualized at twelve percent, so their performance is respectable.

This is one way to learn about money, but may not be the best choice .. unless, of course, your name is Amarillo.

It’s nice when you can make money while learning about money!

I am fortunate to have been able to have a career that now allowed me to do this. It’s a privilege enjoyed by only a few grandparents. The same thing could be done on paper, buying and selling without the commission, but this was a choice I was able to make.

We have learned that there can be more to a good education than just high test scores.

What do you know about investing? Who taught you and when? What is the right age to begin?

No matter your level of wealth, what financial lessons are you passing on to your grandchildren? Do they ever have extra cash at holidays, do they save any of it, or does it just go out as fast as it came in?

As always, the conversation starts here.

“In the ordinary choices of every day we begin to change the direction of our lives.” – Eknath Easwaran

A special “thank you” to Christian Keedy at Gordon Asset Management. He’s been a great partner over the years and helped with these custodian accounts for our grandchildren. Thanks Christian.


With every subject, including investing, simple country lyrics overflow with good advice. Important lessons about, “…knowing when to hold ‘um, when to fold ‘em, knowing when to walk away, and when to run.

“How to never count your money when you’re sittin’ at the table, that there’ll be time enough for countin’ when the dealin’s done.”

Thanks Don Schlitz and Kenny Rogers.