Kids, with their jubilant stream of never-ending questions, provide us with endless opportunities for teachable moments… the ones that educate them and us.
What’s more, many of them also lead to the types of discussions destined to stick in their memory for a long time. So when you’re gathered around the dinner table and questions like “why are adults always talking about the economy?” and “how can I grow up and make a lot of money?” arise, here’s how you proceed: introduce them to the concept of investing and how it can lead to 1) their financial independence and 2) building wealth!
“You Can Grow Up to Be Whatever You Want”… Including Financially Secure!
It can be difficult to explain a complex concept like investing. However, the “you can grow up to be whatever you want” adage provides an excellent opportunity. You can explain how this saying relates to investing, since the right type of investment(s) can help fund their dreams— whatever they may be. To further the conversation of how important it is to invest from a young age, here’s a tactic that’s sure to make an impression— you just need a little help from a popular dessert.
Getting a Bigger Piece of the Pie
As many people—especially kids— are visual learners, take advantage of this by incorporating an enticing prop into the lesson – pie! Yes, pie. Once this dessert favorite has succeeded in gaining their undivided attention, tie it to investing with dialogue that goes something like this: “A college education gets you a career— that’s two pieces of pie. Working hard and getting promoted is a third slice… but what if your sweet tooth still persists? The way for you to earn the biggest part of the pie of all is by becoming an investor.” Their hearts will be beating with anticipation (and their stomachs grumbling with hunger) by the time you get to the best part— how investing has the potential to make them rich (that’s a lot of dessert)!
Financial Independence: As Sweet As It Gets
While they may still be too young to understand the many details that go into a good investment, you can still explain what the different types of investments consist of. While stocks and bonds are two of the most common, their volatility and lack of returns has left a bitter taste in your mouth. So point them toward a better option instead– real estate– by highlighting how this asset class has created many millionaires. But let’s be sure not paint too rosy a picture. Check their expectations by stating that failure to perform due diligence and secure the right investments can lose them their pie altogether.
A Belly Full of Knowledge
Once the power of investing sinks in, your children will never look at the path to success the same way again. What’s more, this conversation will get them planning for their future from an early age, putting them on the fast-track to the sweetest future of all: financial independence.