Vanessa Stoykov is a financial storyteller and educator. Her new novel, ‘The Breakfast Club for 40 Somethings’ is a fictional story of people in their 40s realising the power of money and decision making to set them up in life. Her website, VanessaStoykov.com has tips and a free quiz to see where you need to unlearn limiting money habits.
Investing is something I believe has been sorely lacking in traditional education, and all of us would be much better off if the principles of investing were taught in school – not to mention managing credit cards, debt and savings! So to give children the best chance of being good at creating wealth later in life, it’s important to get them started early.
Here are my three top tips as a finance expert and mother, of how you can help your kids start becoming better with money:
1. Plant the seed early
Some experts I’ve worked with bought their children shares in their early teens, whilst others started an earnings system from work, and saved a percentage to invest on their behalf. Some bought their kids a managed fund at birth. But most agree 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.
- Make the lessons relevant in high school
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.
- Buy shares in a company your kids love
Whether it be tech stocks, medical or media, if young people have a passion or interest in a sector and individual organisation, own some shares (it does not have to be worth much at all) and track the share price versus what’s happening at the organisation it could ingrain a lifelong interest in investing. And we all know the magic of compounding means the earlier you start, the better off you can be.
While schools seem to have come some way in teaching kids about finance and financial planning, there is still a long way to go. One thing is for certain – no longer is it enough to teach our kids traditional education and life skills. In a world where property may be out of reach for most, wealth creation skills will be even more important.
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