'GMA' Transcript: President Obama on Financial Reform, Elizabeth Warren and Shirley Sherrod

And so I have the highest regard for Elizabeth. We have not made a decision about who we're going to appoint yet, but here's my guarantee, is that Elizabeth is going to be working with me, working with Tim Geithner, the Treasury secretary, to help in thinking about how do we make this consumer agency as effective as possible looking out for consumers. She is going to be actively involved in that process.

LEAMY: OK ... Another element of the law is a new Office of Financial Education.

OBAMA: Right.

LEAMY: And I believe financial literacy is so crucial.

So I want to ask you, what are you and the first lady teaching your daughters about money?

OBAMA: You know, it's -- it's a great question, because -- because so many of the problems that we see had to do with the fact that just basic calculations about compound interest and -- and what that means, you know, kids aren't taught that. And so what I'm doing now with Malia and Sasha is, you know, they're getting an allowance. They're starting to get old enough where they may be able to earn some money babysitting. They've got their own savings accounts. And -- and what I'm trying to explain to them are basic concepts about savings, about interest, about being able to use the math skills that they're learning in school to figure out that if -- if they keep $100 in their bank account at 2 or 3 percent interest for six months, this is how much money they're going to have at the end of it.

Those kinds of basic calculations I think we have to make sure everybody understands. And so there is this Office of Financial Education. And we want to work with the school systems. We want to work with a whole range of institutions out there. In some cases, religious institutions, churches and synagogues have been doing really interesting work with their own members of their congregations to work with adults to make good financial decisions.

And -- and I think that this can be a terrific tool for us to continue to spread the word. If they missed your show, you know, a particular segment, then hopefully they'll still be able to catch up.

LEAMY: OK. The other thing I wanted to ask you, has your own retirement fund taken a hit?

In other words, can you feel the pain directly that other Americans are feeling?

OBAMA: Well, part of it has, that part that is devoted to Malia and Sasha's college fund was in a 529, you know, that had been set up when I was still a state senator. And, obviously, that goes up and down with the stock market and so it's lost value like everybody else. Now, I have to confess that most of our money ended up going into Treasury bills when I took office, simply because I wanted to eliminate any possible conflicts in operating in -- in stocks and equities.

But so in that sense, I've -- we were lucky just by happenstance.

But, look, you know, obviously, as somebody who had a grandmother who just passed away recently but worked in a bank and was constantly worrying about her savings, constantly monitoring her accounts and who, you know, I talked to a lot about finances, you know, I saw the effects even at the very beginning of the financial crisis, how it was having an effect on her. And, you know, Michelle's mom has savings that have been affected.

So, you know, one of the reasons that I think that issues like consumer financial protection are

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