MILWAUKEE Kids get a grip on finance in class

The author recommends giving children a fixed monthly stipend.
MILWAUKEE JOURNAL SENTINEL
MILWAUKEE -- Linda Graebner-Smith used to come home from work and find several catalogs laid out on the kitchen counter with circles around the items her daughter wanted.
The result was usually another fight about money.
Those fights don't happen anymore, after the two started taking a class at their church taught by an emergency-room doctor who wrote a book about handling money.
"Once we started this class -- gone, annihilated -- the power struggles are all gone," Graebner-Smith said. "Now when she cost-compares, she finds things she likes at Kohl's and Target."
The advice
The teacher is John Whitcomb, whose book "Capitate Your Kids" recommends that parents provide their kids with a fixed amount of cash each month the same way the health-care industry pays a fixed amount of money for care of a group of patients.
"You want your kids to go to a really good school, to get tough classes in math and physics," said Whitcomb, a doctor at St. Luke's Medical Center in Milwaukee. "But we're not giving our kids the opportunity to solve tough problems in personal finance."
Not unless they're in Whitcomb's so-called Fiscal Fitness class.
All his students keep a budget book detailing how they spend the monthly cash allotment their parents give them. They use checking accounts Whitcomb helped them open by writing a letter they can take to their financial institutions explaining the class philosophy.
If they blow their budget before the end of the month, they either go without or borrow from their parents at a predesignated interest rate.
"As a parent, it's hard when you see your kid making bad mistakes," said Rick Vollbrecht, a member of the church's Fiscal Fitness committee. "But the sooner you train them, the more comfortable you are that when they go off to college they'll make good decisions."
Sure, there may be a few rough spots along the way. Joe Huber, a student in Whitcomb's class, blew all his cash on drum heads and didn't have any money for nearly two weeks, he said. Whitcomb says that's part of how you learn to make good financial decisions -- and the parents who have been watching their kids follow his methods agree.
'Behind the wheel'
"It's like drivers' ed -- there's the class and the test -- but you also get behind the wheel and drive your car down the road," said Larry Huber, Joe's father.
Parents like Huber are an important part of Whitcomb's class. They take their turns along with the kids answering questions Whitcomb rapid-fires around the room, such as "How much is the interest rate on your family's mortgage?" and "What kind of mileage does your family's car get?" They also meet with someone else's kid for the last 10 minutes of the class to review that kid's budget book.
Whitcomb, who grew up in India with his American missionary parents and grandparents, says churches are perfect places for a class like his because families go to them together to express their values and have trust relationships.
He says kids should be allowed to handle their own money -- starting with simple budgets and goals -- in the elementary grades. His class is geared to junior high and high school pupils.
Youth reviews
The students -- who started tracking their expenses in September, then set up budgets in January -- say they don't learn in school the lessons Whitcomb and his fellow committee members are teaching them about handling money.
"I'm going to college next year -- I didn't know how to balance a book," said Kris Rockey, who says his economics class at Brookfield East "never touches on" personal finance.
Topics the class has covered include budgeting, managing checking accounts, saving money, contracts, credit ratings, taxes and loans.