When should you start giving your children money? “The best time to start giving your children money is when they will no longer eat it,” according to Barbara Coloroso, an educational consultant and author. “When they don’t put it in their mouths, they can start putting it in their bank.”

But just don’t hand your children some money. Teach them a little something about it.

For example, tell them a fun fact about money, such as where the word money comes.

It comes from the Latin moneta, which was the name of the place in ancient Rome where money was first made and stored.

Do you know why we call money cash?

Well, hundreds of years ago, money was kept in money-boxes. Eventually the French word for money-box, caisse, or cassa in Italian, became the English word cash.

Interesting, isn’t it?

I learned those two little facts by reading the Color of Money Book Club selection for May, Neale S. Godfrey’s “Ultimate Kids’ Money Book.”

This is a book you should read and work through with your children. It’s most appropriate for children ages 8 to 12, but some children younger and older could also benefit from the illustrations, tips and money facts.

I think it’s unfortunate that parents will teach their children how to ride a bicycle or play chess or work the television remote. But when it comes to money, more often than not they just hand them some cash and tell them, “Save a little before you spend a little.”

Starting at home

The truth is what we teach our children about money is woefully lacking. We aren’t really equipping them to go out in the world and handle their financial business.

“The importance of basic financial skills underscores the need to begin the learning process as early as possible,” said Federal Reserve Chairman Alan Greenspan during a recent speech. “Indeed, improving basic financial education at the elementary and secondary school level will provide a foundation of financial literacy that can help prevent younger people from making poor decisions that can take years to overcome.

“In the long run, better basic education at home and at the elementary and secondary school level will provide the foundation for a lifetime of learning.”

Notice Greenspan specifically listed the home first.

I believe teaching children about money should begin at home. While I think it’s crucial that our schools institute mandatory financial literacy classes for students, like many other subjects it’s the parent’s job to start the financial learning process.

“Instead of just talking dollars and cents, we have to start thinking about bartering and value, income and expenses, savings and checking, debit cards and credit cards, consumers and producers, stocks and bonds,” Godfrey writes in the introduction to her book.

Statistics back need

This is especially true today when about 40 percent of young people ages 12 to 19 have access to a credit card. Thirty-six percent of high school seniors have an ATM or debit card of their own.

The NFO World Group, a marketing research company, found that consumers under age 35 carry an average credit card balance of more than $3,500; that translates to 10 percent of their annual gross income, according to NFO.

Not surprisingly, there has been a 50 percent rise during the past 10 years in the proportion of people under 25 filing for bankruptcy.

Saving, spending wisely, giving to people less fortunate, and investing are important financial skills that children need to know, Godfrey says.

And children don’t come out of the womb with an innate knowledge of how money works. They have to be taught.

So, start with the “Ultimate Kids’ Money Book.” It’s a fun and easy read. Heck, you might learn something yourself.

Godfrey discusses credit, the banking system, the economy, how businesses work and how prices are determined. She even has a section on the Federal Reserve System that won’t bore a child.