How you can get your kids money smart early!
Simple tricks to help children of all ages get a head start on their finances
Considering it’s harder than ever to get on the property ladder and cost of living is increasing year-by-year, creating good financial habits with your kids early is a great way to set them up for their future.
While the term ‘investing’ might seem like something you wouldn’t broach until your kids are older, there are ways that you can plant this seed while they are young and help them understand the value of growing their money early.
TODAY chatted to Finance Expert Vanessa Stoykov for her tips and tricks on teaching your kids the value of money early.
TODAY: Vanessa – when should we start the conversation about money?
STOYKOV: The earlier the better! Investing is a skill that you get better at after time and practice, so the younger your kids are when you start having conversations with them about money, the more likely they are to better understand it later in life.
TODAY: What are the ways we can teach them?
STOYKOV: Here are my tips for different ages:
For young children: The primary school years are good for teaching children the value of money and savings. In a world of instant gratification, getting kids to understand young that they cannot, and should not, have everything they want is a challenge in itself. The ability not to compare with what other kids have is also right up there. Instilling these life lessons into your children early on can only have a positive effect on their relationships with money for life.
For teens: High school seems to be the time most professional investors start exposing their children to investing lessons. One lesson I loved was from Kerr Neilson who believes asking your children to be interested in a company, and understanding that company, was incredibly important to start them off being passionate about investing.
For all ages: Listen to what your kids are interested in (whether it be a certain sector an individual company), and consider buying some shares (it does not have to be worth much at all). Then, work with them to track the share price versus what’s happening at the organisation and this could ingrain a lifelong interest in investing.
TODAY: What about early investing?
STOYKOV: Investing is something I believe has been sorely lacking in traditional education. I for one would have been much better off if the principles of investing were taught to me in school (not to mention managing credit cards, debt and savings!) To give children the best chance of being good at creating wealth later in life, it’s important to get them started early. And we all know the magic of compounding means the earlier you start, the better off you can be.