Parents have many essential skills to teach their kids from a very young age until they grow into adults. But surely one of the most important ones is the ability to understand the value of money, how to use it and how to make the most of it by trying to invest it wisely.
Understandably this is something that some parents struggle with. Indeed some adults struggle to invest their money wisely or even to manage it successfully. In this situation it would be difficult to know how to teach your kids something when you don’t know about it yourself. It may even do damage to try teaching something in this situation, so if this describes you your essential first step would be to educate yourself before moving on to educate your kids.
What can you teach your kids about investments?
This really depends on what age they are. Younger kids can start learning about money and what it can buy in very simple ways, such as through role playing. Bring out the toy groceries and the play money and start there. Understanding what money is and does and what it can get you is only the beginning, but it’s a very good place to start.
Different kids will learn at different paces, but as with other things in life they’ll start asking questions before too long. You can use this to gauge what they are ready to learn and take in as you go along. For example they might start by asking about money in general. It might be a while before they are ready to find out about investing and how this helps to grow your money into something more.
Bite sized chunks of fiscal facts
It’s worth noting that money and investments are two very different things. Thus it makes sense to ensure you focus on one before the other. Also don’t try to teach your kids too much in one hit. Learn to gauge their attention span so you can fit in your fiscal lessons in bite sized chunks. If you try to bombard them with too much in one go you will end up boring them and they’ll associate boredom with money and investing. That’s not what you want to achieve.
Remember too that you can teach them valuable lessons while you are out and about shopping. You could also let them pay money in for you at the counter at the bank. This can be a great way to familiarize them with money and how it all works.
As you can see it only touches on the surface of teaching your kids some of the most valuable lessons they can take forward with them into their lives. No two parents will take exactly the same approach to teaching their kids about finances. The trick is finding the right approach that will work for your own kids, so you always get the best results. This will set the right tone for the future why many young adults “fail to launch”.