investing

The Importance of Investment in a Global World

Posted on Posted in Finance

The ability to acquire, save and ultimately invest earned income is a valuable skill for any individual to obtain. Some individuals unfortunately go without developing this important life skill until further on in their adult lives, which can undoubtedly lead to financial ruin and poor positions for when it is time for them to leave their current workplaces and enter into retirement. This fact leads to a frightening realization: will my children live fruitful lives or will they find hardship during adulthood due to poor financial skill building?

Due to the worry of a comfortable and more stable future it is vital for parents to encourage and emphasize the importance of financial planning to their children, in particular why investment is an intelligent choice. Too many individuals choose to invest their hard earned money at points in time when investing is no longer as beneficial as it could be. The earlier you begin to invest the more you will gain in the long run.

Teaching children about investment at an early age can assist in the following ways:

  • The development of broader scopes of responsibility. This not only covers financial responsibility but is also applicable to other areas of life as well, such as respect for personal property and intrinsic value.
  • Useful money management skills that can increase further interest in mathematics and economics
  • The generation of future wealth
  • Organization and prioritization of needs versus wants

If we simply focus on financial purposes for teaching our children about investment we are missing the main points of what investment truly includes. We are not only educating them on the importance of saving their money we are constructing for them the foundational building blocks of responsible adulthood, and in a broader range are assisting them in developing their constantly growing minds into critically thinking powerhouses of knowledge.

Engaging in dialogue with your children about investment offers a powerful social outlet that allows you to remain connected, even as children transition into adolescence. Offering factual evidence in support of investing in stocks, bonds or other forms of financial opportunities not only keeps conversations fresh and relevant but also shows your interest in your child’s burgeoning adulthood. For this reason investment should be a family based conversational topic.

As the world shifts from simply a physical entity into a more globally connected virtual environment discussion on investment can also lead to valuable conversations about the following, which are extremely important values to instill in your children:

  1. Developing a sense of awareness to issues of personal security and what it appropriate to share and not to share on the internet
  2. Create a concept of size in regards to how vast the world of economics truly is and the role that your child plays to the bigger picture
  3. Instill the fact that everything that is digitally presented to the world, no matter how private it may seem, could potentially be used as a defining feature of personal credit and reliability, which can undeniably affect investment potential.

Investopedia offers a comprehensive list of ideas for how to successfully teach your children about investment. Below is a link to their site for further clarification and ideas to help you:

http://www.investopedia.com/articles/pf/07/childinvestor.asp

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