Teach Your Kids About Our Money

By Neale S. Godfrey For New York Life

In 1861, the U.S. Government began printing the first official United States paper money. These notes were called greenbacks. Even though the government was printing its own money, banks were still allowed to print notes as long as they kept some money with the government. But this led to confusion. Banks in different states, and even banks in the same town, issued notes, or bills. Sometimes banks issued notes worth as little as 3 cents; sometimes the notes were worth a lot more. By 1863 there were thousands of notes in existence, all from different banks!

In 1913 the government stopped letting private banks print their own notes. The government bought all existing notes from the banks and a new system was started. It was about time! The government began issuing all paper money. This was the start of the notes we know today.

The coins we use today are produced in U.S. Government mints located in Denver, Colorado, and Philadelphia, Pennsylvania. The mint in Philadelphia is the largest in the world. When it is not busy minting its annual 13 billion coins for American, it makes coins for other countries. There are mints in San Francisco, California and West Point, New York. Neither of these locations mints coins for general circulation.

Do you know how to tell where a coin was minted? Look at the head of a coin such as a quarter. The tiny letter to the right of George Washington's head is called the mint mar, It tells you where the coin was created: P for Philadelphia, D for Denver. You may see and S or an O since San Francisco and New Orleans used to mint coins and some are still in circulation. Today's coins are not made of gold or silver. They are made from copper and nickel allows, which are cheaper and more available than precious metals.

To make coins, the metal is melted and poured into molds to make bars, or ingots. Machines roll the ingots into sheets. Blanks for each type of coin are punched from these sheets. They are then put through an edge-rolling machine which produces a raised rim. Finally, the designs on both sides of the coin are stamped at the same time. All United States coins have two sayings stamped on them: E Pluribus Unum (Latin for "out of many, one"), and in God We Trust. The completed coins are loaded into machines that automatically count them and drop them into bags which are weighed and sent off to banks.

Show your kids a dime or a quarter and have them run their feel the ridges. Coins haven't always had these ridges. Milled coins, which is what ridged coins are called, were created to solve a problem. When coins were still made from gold and silver, some people would shave the edges of the coins and sell the scraps. Ridges were added to stop this practice. Even though quarters and dimes are no longer made of silver, they still have the ridges.

Between 1935 and 1974 the U. S. minted and circulated a dollar coin. In the 1960's the gambling industry began seeking a new dollar coin. In 1971 an Eisenhower Dollar was minted but never circulated because of its large size. Sometimes we make money that just doesn't work. In 1979 the United States minted a new one-dollar coin. On it was a picture of Susan B. Anthony, who fought for women's rights in the late 1800's. The government thought people would prefer the convenience of a small dollar coin. However, it was too much like a quarter in size, and people were easily confused. Millions of these dollars were minted, but only a small number were circulated. They were pulled from circulation in 1980.

In 1988 the vending machine industry began lobbying for a dollar coin. Armed with the knowledge gleaned from the Susan B. Anthony coin, a new coin was designed. It was to be gold to distinguish it from the quarter which is almost the same size and it has a plain edge so it feels different than other coins. It has a picture of Sacagawea. It was first circulated on Jan 1, 2000 and heavily promoted that spring. It is too soon to know if this coin will succeed where the others have not.

There is only one way you can get your picture on money. You have to be dead. By law, money cannot show a living person. This law was passed so that no person could mint coins as a sign of power, as the English kings did. Ask your children if they think this is still a good idea.

Neale S. Godfrey is a former bank president and an acknowledged expert on family finance. Her 14 books include a #1 New York Times Best Seller, Money Doesn't Grow On Trees and her latest book, Money Still Doesn't Grow On Trees: A Parent's Guide To Raising Financially Responsible Teens and Young Adults. She has authored an educational program called The One and Only Common Sense/Cents Series which corporations are donating into their local community schools and after-school programs. Neale has appeared on TV on The Oprah Winfrey Show, Good Morning America, The Today Show, CNBC, NBC, CNNfn. She frequently delivers lectures on "How to Raise Financially Responsible Children." For more corporate marketing programs, products, and books go to Neale's Web site www.childrensfinancialnetwork.com or call 908-879-8898.

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