Teaching Kids About Investing. How do you do it?
Right now my wife home schools our 3 oldest kids. Earlier this week, I had the opportunity to teach the math lesson. My kids learned the term Cash on Cash Return and then worked out the CoC Return for each property in the game of Monopoly. It was awesome!
The take away lesson learned was the higher priced properties do not provide the highest COC Return. Rather the second to cheapest monopoly provides the best COC Returns.
Robert Kiyosaki talks about having learned a lot about investing from playing the game of monopoly as a kid. How do you teach your kids about money?
Most Popular Reply
Our son has been going to look at houses, show flats and collect rent since he was a few months old. When he was two, we could not pass a for sale sign on a lawn without him campaigning to go "walk the property".
At three we gave him a piggy-bank ... or, rather, a cow-bank called "Moolah the Money Savvy Cow" {NFI} which has four compartments: Save, Spend, Donate, & Invest and started teaching him about these different ways he can use his money. Initially, almost everything went into the Donate and Invest compartments - he decided he wanted to buy a house by the time he was 10 and he was deeply interested in the food-bank and clothing donation boxes at the local supermarket. As he's gotten older, the portion destined for Save and Spend have increased - though Spend is still the skinniest part of the cow.
When we retrofit a building, he receives all the scrape metal (wiring, plumbing, doors/windows/siding), and in the past five years has done surprisingly well (the Cow has had to make a few trips to the bank to "poop" {as the boy likes to say}). Now that he is in-school and has basic arithmetic skills, he periodically checks how much more he needs to make a down-payment on his first {rental} house {being a minor, he cannot borrow on his own and definitely is not eligible for a high-ratio, insured mortgage, so he will need a 20% down-payment and the bank of Mom & Dad if he still wants to purchase a house when he has the funds}.
We also use routine activities such as grocery shopping or fuelling the car/truck to discuss budgeting and how much it costs to run a household - at an age appropriate level.