This post is sponsored by EarlyBird. All opinions are my own.
Have you thought about teaching your kids how to invest?
One thing I struggle with as an adult is that I didn’t learn about investing as a kid.
I don’t blame my parents, they didn’t know either, and neither did theirs before them.
This idea of teaching kids to invest and empowering them with the tools and knowledge to do so at an early age didn’t develop widely until more recently.
Maybe it was a thing rich people did, but for us basic, everyday working folks, the idea of doing our own investing has just not always been a thing and, when you don’t do a thing yourself it’s also challenging to teach your kids to do that thing.
In today’s world, where our reliance on social security and pensions for retirement living has begun to wane, and technology has caught up to make investing online easily accessible, the idea of teaching kids to invest has definitely gained steam.
We all know our kids won’t have what our parents had when it comes time to hang up their work boots, so it’s important that we give them something else to rely on.
Teaching kids to invest gives them the power to not only live financially secure lives in the distant future, but also more immediately as they prepare to cover big expenses like first cars, international travel and college.
Why Teaching Kids About Investing is Important
We are fortunate to have savings set aside to help bear the burden of unforeseen expenses related to our kids and raising our family, but teaching our children about the idea of investing as a means for securing their financial futures is equally important.
I want my children to have everything they need now, but I also want that for my children’s children and their children as well.
The idea of generational wealth is something we are really working to instill in our children. We want them to understand that you aren’t just doing things for your own security and enjoyment, but also to pave the way for future generations of your family as well – to help give them a leg up when needed.
Teaching your children this concept and instilling the desire to make good, long lasting financial decisions and investments is important to helping to create that generational wealth we all long for.
Here’s how we are going about the process of teaching our kids to invest, perhaps these tips will come in handy for you too.
Teaching Kids to Invest: 5 Things Every Parent Should Do
Learn about investing yourself.
The first step is usually the hardest and this is also the case when it comes to teaching your kids to invest.
I had to take some time to learn the basics of investing myself.
I still don’t consider myself an expert by any stretch of the imagination and I don’t see a side hustle of day trading in my future, but I have taken the initiative to understand the basic principles and dip my toes into the investing waters a bit myself.
If nothing else it will help me have an intelligent conversation with my kids about investing as they learn and, eventually, exceed my knowledge in the area.
Talk about finances with and in front of your kids.
And not just the “no you can’t have that because we’re broke” conversation.
Kiplinger.com recommends that parents do this to help kids get generally comfortable with the concept of money.
Talk them about things like debt and setting financial goals. Share with them how you decide to make big purchases and how much you set aside for your savings. Let them see what the process of buying things like cars and houses is actually like.
I have to admit that I was shocked to find myself at a car dealership for HOURS the first time I bought my own new car. It’s not a thing my parents ever did or included me in so I had no idea there was so much paperwork involved!
You don’t want things like how much money you have and how you choose to spend it to be a mystery to your children.
It’s important to let your kids know that running a household in the present and planning to care for yourself financially in the future is part of your day to day decision making process.
Set realistic goals.
One of the most important things about investing with kids is helping them understand that it’s not a sure-fire, get rich quick scheme.
For the average person, investing is about long term goals and helping your child understand that this isn’t so they can buy the video game they want next Tuesday is important.
You want your kids to realize that investing is about the future, that it is more about stability than getting rich, and that it’s something they can (and should!) do no matter where they are in their financial journey today.
We started our kids by introducing save, spend, give envelopes.
When they got money for their birthdays or other special occasions, we would have them split it and decide how much to save, how much they could spend and how much they would donate to a cause they cared about.
Not gonna lie, they were always most excited about the give envelopes because they loved blessing others, but the opportunity to teach them about saving up for something they really wanted was just as important to us as parents.
Make investing easy and fun.
Because anyone with kids will tell you that if it’s hard and boring you’re probably not going to keep their attention with it for long.
There are numerous games you can introduce your children to that will help them gain general financial literacy and even learn about the stock market (here’s a list if you need it).
But even without a formal game, doing things like watching age appropriate moves about the process, reading books and just having fun family discussions about the topic can help make it feel more like an interesting part of life and less like a daunting task.
Get to know Early Bird (and tell your family and friends about it too!)
EarlyBird is a simple to use, interactive app that makes investing in a child’s financial future easy and fun.
They’ve simplified the investment gifting process while making it fun and memorable for families to give financial gifts to kids.
Their easy to use, interactive app means that family and friends can quickly and easily contribute to the financial futures of the kids in their lives in a safe, meaningful way.
It’s a great option for families who aren’t super stock market savvy and they offer a number of expert-guided options to help families make appropriate and safe financial investments with the money their children are gifted.
EarlyBird offers families a custodial investment account, which provides kids financial freedom beyond just saving for educational expenses, whether that is traveling the world, starting a business, or buying their first home.
To make the gifts even more meaningful, EarlyBird allows gifters to record video memories to personalize the gifts. I love the idea of gifting something to my nephew right now while he’s seven and attaching a video to it that he can watch in ten years when he’s 17 and heading to college!
And, unlike 529 plans and other college saving programs, the funds in your child’s EarlyBird account don’t have to be used on educational expenses. That means that if your child wants to go on a mission trip in high school or you want to allow them to use the money towards their first car, they can do those things as well.
EarlyBird provides a great way for families to introduce the idea of investing to their children in a safe, easy and fun way!
To learn more about EarlyBird, be sure to download their app today!