TALK to Your Kids About Money!!
This may seem obvious, but...talk to your kids about money. Talk to them about how much things cost so they have a sense of scale. I’m not suggesting you tell them how much money you make (unless you want everyone to know), but let them know how much things in their world cost.
Start to have this conversation about money and cost just as you do when you teach them the rest of the foundations of life; the same way we teach them to look both ways when crossing the street and to wash their hands. Teach it to them as it happens while you are together, and find a way to make it relative to their world too.
If your child’s world is a toy or treat, then tell them the cost in dollars. If their world is Pokémon cards, then make sure they know how much a pack of Pokémon cards costs. Whatever they are into, make sure they understand the dollar value, even if they don’t yet understand what a dollar is worth. It will give them a baseline for the future as they learn about the cost of things.
Also teach them to be value conscious and that the same thing might have a different price depending on where you buy it. If you observe a big markup on something, where the company is undoubtedly making a lot of profit, point it out to them. Doing these things will not only help them be more prudent consumers as they grow up, it will help them recognize good businesses and therefore, good investment opportunities.
Begin to have conversations with your kids about businesses you see every day. Chances are, most of the time you’re spending money there’s a business associated with it. Help your kids be aware that there are businesses all around that you take for granted. Some are small, locally-run operations. Some are enormous corporations that could become potential stock picks for them.
If we’re preparing our kids for the real world, we owe it to them to teach them how to handle and understand money. I used the conversation about money to springboard my kids towards even larger lessons about stocks. Using simple, commonsense analogies we can teach them to turn savings into assets, and assets into a financial base to build a future upon.
(This is an abridged excerpt from Chapter 5 of Teaching Kids to Buy Stocks: Stories and Lessons for Grown-Ups)
PS THANKS TO @theteaching.momma! for the love on Instagram! ❤️❤️