Teaching your children about investing Teaching your children about investing For centuries parents have tried in vain to teach their children the value of a dollar. But don t think that your kids are too young to learn about investing. As we all know, the key to making a good investment is to start investing early. Here are a few ways that you can introduce real-life investing to your child. Explain how interest works.
Children have difficulty understanding how money can make more money.
Explain that when you lend your money to the government or a company, that they pay you money back for the favor. Alternatively, you can describe that investments are like buying a little piece of a company and you earn money when the company gets bigger. Let your children choose a fun stock to follow like Disney or McDonalds. Follow the stock together and keep track of its daily progress on your refrigerator door. Children are easily excited at the prospect of doing well in a game.