08/17/98 INVESTING FOR KIDS: CHILD'S PLAY ON THE WEB

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INVESTING FOR KIDS: CHILD'S PLAY ON THE WEB

In conservative families like mine, there were two topics parents didn't discuss in front of the children--and the other one was money. Needless to say, my money skills left something to be desired: I routinely blew most of my allowance and yard-mowing money as soon as I got my hands on it. But judging from recent surveys, I was a financial whiz compared with the current generation: In a 1997 study of how well teenagers grasped simple money concepts, only 5% of the 12th graders polled scored higher than a C. And less than half knew that if workers' wages doubled, their income would double as well.
If you would like your children to grow up savvy about saving and investing, a number of Web sites can help (table). Granted, even the best sites lack the depth of a good book, and are no substitute for hands-on parental guidance. But given the appeal the Internet holds for most kids, these sites can help teach that saving and investing can be fun--and not just a grim exercise in deferred gratification.
COLD LEMONADE. If your child is still young, a couple of simple sites are designed for short attention spans. First Technology, a credit union in Oregon, offers the Kid's Club Savings Calculator, an applet that asks your child to choose a goal--say, a video game or bicycle--and then helps calculate how much to set aside each week to achieve the needed savings. At Bonus.com, you'll find links to games that help kids grasp fundamental ideas about money: They can operate a virtual lemonade stand, provide the correct change to a soda jerk (played by Honest Abe), and--what were they thinking?--play a virtual slot machine. These games aren't listed on the main Bonus.com menu, but clicking on ''search,'' then typing in ''money'' will get you there. One warning: Given the lavish use of Java by Bonus and several other of these sites, don't try gaining access with anything less than a Pentium-powered PC, and even then be prepared for a few glitches.
If your budding Warren Buffett is bored by these sites, click over to Liberty Financial Co.'s Young Investor, which is aimed at teens. First, pick one of six tour guides--ranging from robotron Blad to superhero Bengod--who will walk you through the site's many features, including such exercises as a crossword, a rebus, and the Money-Tron memory game. Liberty also awards gift checks and prizes such as a digital camera to kids who post savings tips and answer its ''Measure Up'' survey. Parents may find the queries too personal: Questions include how much allowance kids get, plus whether they have received stock, savings bonds, or other finance-related gifts from relatives, and if so, who gave it. But Liberty insists the information isn't sold--and is only recorded for ''internal marketing purposes'' and to identify prizewinners.
It's never too late (or early) to teach your kids the ABCs of investing. One of the best primers is at Investing for Kids, a surprisingly polished site, given its origin as a science project for three California grade-schoolers. The site offers an introduction to investing, as well as a special section explaining the market math for computing commissions and determining the ''net asset value'' of mutual funds. The site also sports its own stock and mutual-fund contests, complete with current standings of the 500 best returns--but, alas, no prize other than the respect of your peers.
However, A.G. Edwards, a St. Louis brokerage (www. agedwards.com/bma/index.shtml), awards T-shirts each week to the top finishers in its Star Traders stock-picking game, based on the previous month's results. And at MainXchange, kids can parlay their investment prowess into prizes from sponsors ranging from CompUSA to Hasbro. Players are given 100,000 ''virtual dollars'' and access to stock quotes, charts, news, and other tools. MainXchange rewards those investors with the best returns each month. Participants can also accumulate points toward prizes by answering business-related trivia questions.
EXTRATERRESTRIAL. To give your kids a taste of what it's like running a business, head to the Web site of LavaMind--developers of such PC strategy games as Zapitalism--where you can download a shareware version of its popular Gazillionaire game. A cross between SimCity and Monopoly, Gazillionaire lets players run an extraterrestrial trading company--and in the process, learn about supply and demand, compound interest, and profit margins. A warning: Despite LavaMind's efforts to spiff up the program with arcade-like sound and graphics and to provide on-screen tutorials, you'll still spend a lot of time poring over pricing charts.
If you still feel you need pointers on teaching money skills--or would simply like to compare notes with other parents--head over to Prodigy's Kids' Money site. Here you'll find links to dozens of articles aimed at parents by experts from Dr. Spock to Dr. Tightwad, mostly addressing the issue of allowances--including poll results about allowances. (74% of participants give a weekly allowance, averaging $3.50 for 6-year-olds and $35 for 18-year-olds. But 77% of parents tie allowances to chores, according to another poll.) You can also enter pictures of your children with their favorite savings vehicles in the ''That's My Piggy'' photo contest.
At the ''Save Lab'' page in Merrill Lynch's Family Saving Center (www.plan. ml.com/family/index.html), you can order several free print publications, including the Teach Your Children to Save activity workbook and the Savin' Dave and the Compounders comic book. (Doing so will presumably guarantee you a call from a Merrill Lynch broker.) Bookmark this site for future use, because each spring Merrill Lynch sponsors a savings poster, essay, and video contest, with winners receiving up to $1,000 in savings bonds.
TEEN JOBS. When teens get summer jobs, they'll be flush with cash--and easy prey for kid-oriented marketers. To help them become savvy shoppers, point them toward the Consumer Education for Teens site (www.wa.gov/ago/youth) designed by high school students in Washington State. You'll get the lowdown on everything from fly-by-night modeling agencies to those ''12-CDs-for-a-penny'' music clubs.
The learning doesn't have to stop when you turn off your PC. Merrill Lynch offers an exhaustive list of savings books for kids, some of which you can probably find at your library. And at Software.net (www.software.net), you will find money-related kids' software programs, ranging from Math of Money to Money Town. After all, money is something every parent should talk about in front of the kids.
By Dean Foust
EDITED BY AMY DUNKIN

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TABLE: Money Lessons for Kids