04/14/2011 02:20 pm ET Updated Dec 06, 2017

No Child Is Too Young to Learn About Money Values... Just Ask Elmo!

A few months ago, I got the kind of phone call that would have made my preschool-age self jump for joy: "Sesame Street" wanted me to talk to Elmo about money. OK, I admit it: Even my way-past-preschool self jumped for joy. After all, who better to teach kids than the people who created a lovable grouch living in a trash can, a monster who loves cookies (sometimes, of course) and a Transylvanian count who spreads the joy of... counting?

The project Sesame Workshop described was ambitious and exciting: They were embarking on a major financial literacy initiative that would equip parents to teach their young children the building blocks of money basics. The lessons would involve big-picture concepts, rather than things like how to write a check. The point is not that five pennies equal a nickel, but how we make decisions about using that nickel.

For many parents, teaching their children about money is much easier said than done. Parents have no trouble telling kids to brush their teeth or buckle their seatbelts. But when it comes to finances, adults would probably prefer the sex talk to the money talk!

Frankly, many of us are right to feel shaky: A major 2009 study conducted by FINRA, the Financial Industry Regulatory Authority, found that fewer than 10 percent of Americans could answer five very basic questions about topics like interest rates and inflation. Meanwhile, we are acquiring credit cards -- and serious debts -- at ever-younger ages.

There's a critical need here, but it's not all doom and gloom. The good news is that even non-mathematician parents -- heck, even parents who have some major financial mishaps in their past -- can help their kids develop good habits. As research by University of Wisconsin-Madison Professor Karen Holden has shown, young children can learn the basics of good financial habits even without math skills. The heart of financial literacy is about values and choices, not number crunching.

Sesame's first step in creating this project was to gather a group of advisors. Along with yours truly, they included academics, community organizers and nonprofit leaders. For a full day, we sat together in a room in Pittsburgh and hashed out the most important things kids need to know about money basics. Then we spent another six months finalizing the materials. In the same period, I was appointed to the President's Advisory Council on Financial Capability and joined its Youth Subcommittee, so teaching kids about money became a huge issue for me.

That's where Elmo and I come in. I hopped on over to Sesame Street and had a conversation with my little red furry friend about how money works. (What a day! Who knew Elmo was so much fun -- on screen and off!) Here are just a few things we talked about, which I think are important not just for kids, but for their grownups, too: 

  • We make choices every day. When you go to the store, you have a finite amount of money. You can't buy all the different paint sets -- you have to choose one.
  • Sometimes we have to wait. (It's good to delay gratification.) You may have to pass up tempting items now to buy one big thing that you really want later. 

  • It's good to help others. You can share your time, your talents and even your money. And sometimes it's fun to share money with a friend who has less. 

  • People work to make money. A teacher earns money. A police officer earns money. The librarian earns money. You can recycle cans, wash a car, or rake leaves and make money. 

  • You can keep money in three jars. If we get money, like from our grandma for a birthday present, we can put it into three jars: some of it is for spending, some is for saving and some is for sharing.

Not one of these lessons is strictly about math, but all of them are about values, which every family has. Now, every parent is equipped to nudge their kids in the right direction -- with a little extra help from Elmo.

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Sesame's free finished product, "For Me, for You, for Later: First Steps to Spending, Sharing and Saving," contains a video featuring the hip-hop artist Common and me teaching Elmo about money, as well as guides for kids, parents, caregivers and educators that offer tools, techniques and language to use during everyday moments, like going to the grocery store or playing at the park. The video and guides can be viewed or downloaded at and, and the video is also on VOD and iTunes -- search for the title "Learn Along with Sesame." Packets will also be distributed for free at PNC bank branches (PNC funded the project as part of a 10-year, $100 million Grow Up Great initiative, intended to help prepare very young kids for success). And all materials are available in English and Spanish -- so cool to hear myself speaking with Elmo en español.

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Beth Kobliner is a personal finance commentator and journalist, the author of the New York Times bestseller "Get a Financial Life: Personal Finance in Your Twenties and Thirties," and a member of the President's Advisory Council on Financial Capability. Visit her at, follow her on Twitter, and fan her on Facebook.

Photo © 2010 Sesame Workshop. "Sesame Street" and its logo are trademarks of Sesame Workshop. All rights reserved. Photo by Richard Termine.