Teaching children about financial investment from a young age can instill good financial habits. By learning basic concepts of saving, budgeting, and investing money, children can develop money management skills that will benefit them throughout life. This article will provide some examples of how to introduce financial investment to children in an age-appropriate way.
Open a savings account for your child
Opening a basic savings account for your child is a good first step. Have them put gift money or allowance into the account instead of spending it. Watching their small deposits earn a little interest will show them the basics of how investment growth works.
Give gifts of stocks rather cash
Consider gifting a share or two of stock rather than cash on special occasions. Let your child track the stock price over time. This shows them first-hand how investments can grow in value over the long term.
Involve children in household budget meetings
Hold family meetings to review the monthly budget and spending. Let children listen in so they understand where money comes from and where it goes. When they’re old enough, have them help make a few spending decisions.
Starting financial investment education early allows ample time for compound growth. The small actions we model for children today become lifelong habits as they grow older. By teaching children to save and invest through simple, hands-on examples, we prepare them to responsibly manage money as adults.