While it is true that the concept of financial investment is daunting to most adults, this shouldn’t discourage them from showing the ropes to the young generations. Teaching teens how to invest their money may help them reap the benefits sooner. Here are some tips on getting them excited about investing:
Keeping it simple.
The world of finance is littered with complicated jargon that may scare off or bore teens, so the best way to reach out to them is to use concepts they will understand. CPA and personal finance expert Mike Piper shares that his mother explained stock investment to him using Pringles potato chips. According to Piper, his mother bought him a share of Procter & Gamble stock and told him that each time someone bought a can of Pringles (and other items from P&G), he would receive a check containing part of the company’s earnings a few times every year.
Letting teens have financial freedom.
Once teenagers have been introduced to various concepts involved in investment, it’s time to let them experience it for themselves. American Association of Individual Investors VP Charles Rotblut suggests giving teenagers their own account and letting them decide on where to invest their money. Whether they succeed or fail, it’s important to let them understand why it resulted that way. These lessons will guide them in future financial decision-making.
There’s no formula in teaching teenagers how to invest their money. Luckily, there are many resources available that can make the concept easy to comprehend. However, the presence of parents or mentors will always be necessary so they can answer the youngsters’ questions and offer advice.
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