Wednesday, June 27th, 2018
Kyran is 11 and lives across the street from me. He wants to buy a pair of rollerblades. To earn money to buy them, he's helping neighbours with lawnmowing and yard work.
Late last summer, I hired him to help me clean up a large backyard flower bed. As we clipped thorny rose bushes, trimmed spent daisies and pulled stubborn weeds, we discussed everything under the sun – including money.
"Miss Anne," he asked out of the blue. "What would you do if you won a million dollars?" I told him I'd put most of it into investments. He responded with another question: "What's an investment?"
I'm not sure I gave him a good explanation on the spot, but I realized afterward that Kyran's at an ideal age to start learning simple investment concepts. He already grasps the basics of money and is earning some of his own. He also understands that if he wants to buy an item that costs more money than he has—like rollerblades—he has to save for it.
So upon reflection, here's how I'd explain investing to someone Kyran's age.
An investment is something we put our money in to help it grow. If we just keep our money in a piggy bank or drawer, it won't earn any money for us.
There are many different kinds of investments: savings accounts, bonds and stocks, etc. Each of these helps our money grow and work for us in different ways:
In the meantime, I'll encourage him to save some of what he earns from his part-time jobs. By learning and cultivating good investing habits now, Kyran will ensure that his money—like a well-tended flower garden—blossoms and grows for years to come.
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