Most parents do more harm than good when they try to teach their children about money. They make saving seem like a punishment, and force their children to view reckless spending as their only rational choice. To most kids, a savings account is just a black hole that swallows birthday checks.

David Owen, a New Yorker staff writer and the father of two children, has devised a revolutionary new way to teach kids about money. In The First National Bank of Dad, he explains how he helped his own son and daughter become eager savers and rational spenders. He started by setting up a bank of his own at home and offering his young children an attractively high rate of return on any amount they chose to save. "If you hang on to some of your wealth instead of spending it immediately," he told them, "in a little while, you'll be able to double or even triple your allowance." A few years later, he started his own stock market and money-market fund for them.

Most children already have a pretty good idea of how money works, Owen believes; that's why they are seldom interested in punitive savings schemes mandated by their parents. The first step in making children financially responsible, he writes, is to take advantage of human nature rather than ignoring it or futilely trying to change it.

"My children are often quite irresponsible with my money, and why shouldn't they be?" he writes. "But they are extremely careful with their own." The First National Bank of Dad also explains how to give children real experience with all kinds of investments, how to foster their charitable instincts, how to make them more helpful around the house, how to set their allowances, and how to help them acquire a sense of value that goes far beyond money. He also describes at length what he feels is the best investment any parent can make for a child -- an idea that will surprise most readers.

"The First National Bank of Dad" was the answer, and upon reading its subtitle 'The Best Way to Teach Kids about Money' I scooped up a copy. Having two little spenders of my own, I knew I needed this new advice manual from a man who has been there before me. FNBD did not let me down. David Owen writes with a straightforward, humorous, easy-going style that spews common sense and good ideas. His Bank of Dad idea is genius, but only because it flips upside-down the usual parenting mantras of command and control. Put your kids in charge of their money urges Owen, and watch them learn how to spend and save. Stop running Aunt Millie's birthday presents down to the local bank, which to your kids is a "black hole that swallows birthday checks." Instead, Owen puts his kids entirely (almost) in charge of their money, and with his home-based Bank of Dad gives them the opportunity to learn about the power of compound interest. Using a home computer and a slightly more influential rate of interest, he quickly captures his kids' attention.

It's a terrific idea, one I've already adopted, and my kids are unexpectedly as thrilled as his. Owen has more. He teaches his kids free market economics via eBay, creates his own successful Stock Exchange of Dad, and expostulates on the value of part-time employment for kids. His recommendations are surprisingly fresh, honest and logical. Chapter Seven offers perhaps the best observations about life and I could think of many adults I know who would benefit from reading this alone. Chapter Eight is an epistle to the value of reading. By "learning how to purse a subject until their curiosity is satisfied," Owen observes, "later in life they will be able to use that same ability to teach themselves about the bond market." And anything else.

FNBD is an investment of under six hours reading time. It is already paying dividends in my home.

Owen's philosophy is sound, his approaches are sensible, and this book is easy to read and often funny. Highly recommmended.

This book was enjoyable and informative; I recommend it to anyone with young children.