How To Teach Investing To A 3 Year Old
We tend to make investing more difficult than it really is. The goal of any investment is to make money.
Here’s a simple way to teach investing to a 3 year old.
- Select their favorite cereal
- Ask them, “Do you like this cereal?”
- Desired Response: “Yes!”
- Then ask, “Do you think other little boys and girls like this cereal?”
- Desired Response: “Yes!”
- Do you think there will be MORE little boys and girls in the future or LESS?
- Desired Response: “MORE!”
- Then maybe we should own part of the company that makes this cereal. Would you like to own part of the cereal company?
- Desired Response: “Yes!”
- Purchase stock (using your favorite stock trading company) – Maybe General Mills (GIS) or Post Holdings (NYSE: POST)
- Better yet, purchase a mutual fund that owns cereal companies within it
I’ve done this with my daughter when she was 3. I’ve continued the conversation. As a teenager, she is an informed investor who I’m proud to say is becoming a financially confident leader.