Harris

Adults should be aware of the benefits of investing long-term. Instead of growing to regret not investing years ago, use this knowledge to give your child a financial edge for the future.

Spark their interest in investing from an early age. Doing so can instill a lifelong interest in positive financial habits. But how do you get your child interested in what seems to be an abstract concept? Simple - get them to participate in the process.

Start Simple

Get your child to set a short-term goal such as purchasing a new toy, and then have them set aside a portion of their allowance over a period of time to achieve this goal. Once this goal is reached, have them set others. Such a strategy should ignite the habit of putting aside money, setting goals, and managing resources. It will also aid in making the transition to investing and setting long-term goals much easier.

Select & Track your Investment

Gradually introduce your child to investing. Choose investments that you both can track together, such as unit trusts, and take the time to explain what a unit trust is. Investment houses usually provide very colourful, informative and easy-to-read brochures that can aid with your explanation. Investing in unit trusts will also provide you with the convenience of having a diversified portfolio, which is managed by highly-skilled professionals.

Open ajoint account with your child. Now that it's the summer holiday, this is an excellent occasion to have your child accompany you to an investment firm. Ensure that some of the funds used to start the account come from your child's personal savings; regardless of how small their contribution may be, they will feel more involved in the investment process.