Teach Your Child Investing Best Practices
you’ve got the Investing basics down, It’s TIme to Dig in
Updated March 25, 2023
Once you’ve got the tools to kick start your kid’s investing habits, you can dig in to investing. If you need a refresher, we covered investing basics (stocks, bonds, mutual funds & ETFs), given you three ways to invest for your kids (529s, online investment accounts and IRAs) and provided an age-appropriate guide to help parents get started investing, no matter what stage their kiddos are in.
Investing is a key part in financial literacy for kids, because the sooner kids get started investing their money, the more their money grows. So, now that the investing ball is rolling, it's time to put it into practice. (We’re in it for the long haul, after all.) We offer three important tips to maximize your investment with your little financial wizzes.
3 Best Practices for Investing
1. Discuss and set boundaries Before You Start
Have a pre-investment discussion with your child and set boundaries. Decide together how you will allocate your money between stocks, bonds, mutual funds, ETFs and other investments. Make sure the portfolio is set up for long-term investing and agree on an appropriate level of risk. (Team BT suggests that any meme stock or crypto investments do not not exceed 5% of the total portfolio.)
2. Schedule Check-Ins
Schedule regular portfolio check-ins. Decide if it is best to check-in weekly, monthly or quarterly to track progress, analyze investments, and make any necessary changes or updates.
3. Stay Current on Financial News
Make sure your teen is staying up-to-date on the latest financial news. Whether it’s skimming the Wall Street Journal, subscribing to the Morning Brew, or catching a few minutes of CNBC, make sure your little investor has a handle on the latest financial news.
What’s your favorite way to stay up-to-date on the markets and latest financial news?