HARRISBURG, Pa. (WHTM) — Last week, we talked about senior citizens and finances, well it’s just as important kids know about money too.

The time to teach them is when they’re young, and one local expert has a way to do it.

“How can we expect our young adults if they have never handled money before to all of a sudden go out on their own and be successful at it?”

Jim Degaetano is a certified financial planner in Carlisle.

He says 80% of Americans are not prepared for retirement and our behavior is a major reason for it.

“We’re not taught in high school about money, we’re not taught in college about money unless you study accounting and finance so how would you know, absent your parents and if they weren’t taught about it how would they know.”

Jim wants to break that cycle by teaching financial literacy to kids.

“I wrote this cute little book, “Larry the Bunny Saves his Money.” It’s very simple. It’s a cute little bunny that goes to work, makes 10 carrots a month and his dad taught him every time you work and get your pay save two carrots for another day,” said Degaetano. “So Larry the bunny goes through all these activities of life and so the kid in a very simple cause-and-effect way will learn saving is good, and that’s all you need to know at that stage of the game.”

Jim has three important lessons you should use with your children.

  1. Delay instant gratification by saving for the future
  2. Play games with them to teach them about money
  3. Simply talk to them.

“They know mommy and daddy go to work and that a house costs money, and pizza, it’s ok to talk about that in very elementary terms with them. And then show it – as parents, your kids are going to emulate you and if you don’t have solid money habits then it will be hard to instill that in your kids.”

“Another thing you’re really big on is not just the importance of money but the importance of where money comes from,” said Degaetano. “How do you teach your children about that? It doesn’t grow on trees that’s for sure. Kids are smart and we don’t give them a lot of credit for what they notice.”

Jim says let your kids watch you pay bills and help them understand the cost of things around them.

While his book is designed for kids 7 and under, when it comes to money, everyone – even parents – can learn a thing or two.

“They started reading it to their kids and noticed ‘wait, am I doing these things?’ and the percentages in the book actually fit what adults should be doing. How much should be going to their savings and investments out of what they make, how much you’re going to have to pay Uncle Sam, how much is reasonable for buying groceries, buying a car, buying a home, that all fits at the adult level as well.”

One more tip from Jim, give your kids three separate piggy banks. One for saving, one for sharing, and one for spending.