Introduce your kids to smart money moves with How Ella Grew an Electric Guitar.
My son has an interest in music, specifically in learning guitar, and he is also interested in ways to earn more money. So I thought it would be fun for him to read How Ella Grew an Electric Guitar?by Orly Sade and Ellen Neuborne.
We both read the book, and enjoyed it. How Ella Grew an Electric Guitar is the story of how a sixth grader learns about making money in order to reach her goal of having an electric guitar appropriate for a rock band.
Teaching Kids Financial Principles
Ella wants an electric guitar for her rock band. However, she only has $25 — and she needs $229 to make the purchase (the book talks about how she needs to figure the tax on the guitar, as well as the purchase price).
She begins exploring different options for earning money. Ella learns from her brother that it's possible to let money sit in a savings account and earn interest each year, but you won't earn a lot of interest if you want to keep that money safe. (“Hey, I have more money than that saved up!” said my son after reading about Tom's $250.)
Next, Ella looks at stocks, wondering how to make it work. Her father describes a rather boring approach to investing (my kind of guy!) that requires patience in the long term, since it's probably not appropriate for Ella to risk too much of her money.
Ella's too young to get a job at a store, so she decides to open her own business.
One of the things I like about this book is that Ella and her friend open a lemonade stand that fails. I like that Ella learns a lesson in failure, and the difficulties in starting her own business. But she doesn't give up. Her mother gives her a lesson in market research and creating a business plan.
Interspersed with all these lessons about money are typical things you'd find in a book aimed at pre-teens: Rock concerts, crushes, school dances. I really like how the book makes it fun for kids to see how real-world decisions can affect their earning power — and I like that the book focuses on different ways to make money, with an emphasis on entrepreneurship.
One of the things that is becoming increasingly clear to me is that wealth creation is the way to go. Rather than just working at a more traditional job and hoping to sock away enough in savings, it's important to grow wealth and look for ways to improve earning power — including things like starting a business and cultivating passive income.
Overall, How Ella Grew an Electric Guitar is a great read that my son and I both enjoyed. It teaches solid money lessons, and shows kids that they can make good financial decisions now, setting them on the path to create the wealth they need to achieve their own money goals.