Educating kids on how to save is a valuable first step toward learning how to manage money. But it shouldn’t stop there. While savings accounts are a safe bet and an easy concept to grasp, the real earning power comes from investing their hard-earned cash.
But why is this so important you might ask, why are teens in the best possible time to start trying their hands out on investment? It’s mostly because to the gift of time.
Imagine that you as a teen had known so much about investing in real estate for instance, and maybe guided by your parents had bought into a choice area, say Chevron drive area(what it used to be before then). Fast toward to your years now say in your late: 30’s or early 40’s,more than 20 years after, can we talk about the incredible value that investment would currently have, thanks to appreciation and development?
The earlier your child starts investing his or her money, the greater the rewards are later. That’s due to the magic of compounding and appreciation, wherein the gains continue to grow.
Now the default tendency might be to underestimate these kids, as to their comprehension when inculcating into them basic investment principles. However, kids will surprise you with how much they will understand. … If you start with very simple things like relating it to products or services they use, you can explain the high-level concept of investing to most kids.
Teens are interested in learning, especially the new age ones who don’t learn only by reading from a book. If they can learn by doing, they will adopt it and they will actually learn the key things you want them to learn.
A great life lesson to teach your teens is that true wealth is built, not by saving but by investing. You don’t really build wealth with a savings account. The earlier you begin to teach and prepare your kids, the more time they have to learn, ask questions and make mistakes in a safe and supervised way.
So imagine the possibilities if they get some experience in investing in their teen years and then go in get their first job or start up their businesses and are aware of the investment options that are open to them.
Explore/teach investing as a family. Work with kids and show them the basic ropes of investments, why some Investments are safer than others. As you research investments, share your findings with them and break it down to them with relatable, easy semantics.
Teach them that investing is a long term game. Encourage kids to invest only money that they don’t need in the short term, because most successful investors take a “buy and hold” approach to investing. Share stories and books about successful long-term investors.
Start small and learn from mistakes. Show kids the power of investing with a small sum of money so they can make mistakes and learn from them without it costing a large amount. Help them break that fear of investment-entry early on, so that they get better at wit with practice, having learnt from testing the waters and getting their hands in the game with lite funds per time.\
In the long run, the hope is that investing becomes a habit that would have nurtured and cultivated as they go on in life.When they earn or receive money, the natural first thought would be to invest a portion of it, and overall you would have helped them build the healthy financial habit of saving and investing. If this goes round full cycle, we would be raising a financially smart generation, wouldn’t we?
To help your teens test the investment waters safely, work with them in getting a Crowdownership real estate investment today. With Crowdownership, you or your teenager purchases units of real estate below market price and then either buy enough subsequently that can be allocated to them as a full unit, or they can resell down the years at current market value with the full benefit of appreciation. To get started, visit: www.crowdownership.ng or Call/Whatsapp: +2348092615555