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5 Creative Ways to Teach Your Kids About Stock Market and Investments

Updated: Jan 27


As an educator and advocate for financial literacy, I've seen firsthand the impact of introducing kids to the world of finance early on. Understanding savings and investments is a vital life skill, and the sooner our kids get a grip on it, the better. But let's face it, topics like the stock market and investments can be pretty dry and complex, especially for young minds. That's why I'm here to share some fun, engaging, and practical ways to break down these concepts for your kids. Let’s dive in!


 

Table of Contents

 

child learning about saving and investing


1. The Stock Market Game: Learning by Doing



Turn Investing into an Adventure


Engaging kids in a hands-on, interactive Stock Market Game is an excellent way to introduce them to the world of investments and finance. Here's a step-by-step guide to set up this educational adventure:



Step-by-Step Guide to Creating Your Stock Market Game


  1. Choose Your Platform: Decide whether you want to create a physical board game at home or use an online stock market simulation platform. Online platforms often offer real-time market changes, which can add an extra layer of realism.

  2. Create a Market Environment:

    1. If you're going physical, create 'stock' cards for different fictional or real companies.

    2. For an online game, choose a platform that is child-friendly and easy to navigate.

  3. Assign Starting Capital: Give each player a set amount of fictional money to start with. This will be their investment capital.

  4. Explain Basic Rules:

    1. How to buy and sell stocks.

    2. How stock prices can change.

    3. The concept of market opening and closing times (if applicable).

  5. Introduce Real-World Scenarios: Use news events (either real or made up) to influence stock prices. For example, if a tech company releases a new product, their stock might go up.

  6. Set a Time Frame and Objectives: Decide on the length of the game (e.g., a week, a month) and set specific goals (like achieving a certain portfolio value).

  7. Monitor and Adjust: Keep track of stock prices and adjust them based on market conditions or predetermined scenarios.

  8. Reflection and Discussion: After the game, discuss what strategies worked, what didn't, and what they learned about the stock market.



Why The Stock Market Game Works


  • Interactive and Engaging: This hands-on approach is a great way to demystify the stock market's workings.

  • Real-time Learning: As they buy and sell 'stocks', kids will understand market fluctuations and the impact of global events on investments.

  • Teaches Risk Management: They’ll learn to make informed decisions, understanding risk and reward in a safe, controlled environment.



Incorporating this game into your financial education toolkit can make the concept of savings and investments for kids not just more accessible, but also a lot more fun. By simulating the stock market environment, children can learn valuable lessons about investing, the importance of research, and the impact of global events on financial markets. It’s an exciting way to build a foundation for financial literacy that will serve them for years to come. Check out our deep-dive article on how to teach your kids about stocks and investing if you want some more fun ideas!






kid learning about finance through books and investing


2. Storytelling with Financial Themes



Bringing Investments to Life with Stories


Using storytelling to teach about finance is not just engaging but also incredibly effective. Here’s how you can weave financial lessons into captivating stories:


Creating Financial Stories for Kids


  1. Choose a Relatable Theme: Start by selecting a theme that resonates with your child. This could be anything from running a lemonade stand to saving for a new bicycle.

  2. Introduce a Character: Create a character that your child can relate to. This character should face financial decisions and challenges.

  3. Set Up a Financial Goal: Give the character a clear financial goal. For example, the character could be saving money to buy a gift or invest in their small business.

  4. Introduce Challenges and Solutions: Throughout the story, introduce various financial challenges. Show how the character tackles these problems, highlighting the importance of saving, investing, and making smart financial decisions.

  5. Incorporate Financial Concepts: Weave in basic financial concepts like profit, loss, investment, and savings. Use simple language to explain these ideas.

  6. End with a Moral or Lesson: Conclude the story with a clear takeaway or lesson about the importance of financial planning, the value of money, or the power of investment.

  7. Discussion Time: After the story, engage your child in a discussion about the story’s financial aspects. Ask them what they would have done differently and what they learned.



Why Storytelling with Financial Themes Works


  • Creative Learning: Using stories to teach about investments and savings allows children to see these concepts in action in a context they understand.

  • Relatable Scenarios: By tailoring stories to your child's interests, they become more engaging and impactful.

  • Builds Foundation: These narratives lay the groundwork for understanding more complex financial concepts later in life.



Storytelling’s unique ability to simplify complex concepts like savings and investments for kids makes it an invaluable tool in financial education. It transforms abstract ideas into tangible, understandable scenarios, helping children grasp the importance of financial planning and decision-making. By regularly incorporating these stories into your child's life, you can instill valuable financial lessons that will benefit them throughout their lives.







saving jars teach kids about investing

3. Investment Jars: Visualizing Growth



A Tangible Way to Understand Investing


Investment jars offer a hands-on, visual method to teach kids about saving, investing, and spending. Here’s how you can implement this effective teaching tool:



Setting Up Investment Jars


  1. Gather Your Materials: You'll need three clear jars, labels, and a small amount of play money or real money if you prefer.

  2. Label the Jars: Label each jar with one of the following: Savings, Investing, and Spending. Explain the purpose of each jar to your child.

  3. Initial Allocation of Funds: Distribute a set amount of money among the jars. You can do this weekly or monthly, depending on your preference.

  4. Create Rules for Each Jar:

  • Savings Jar: Money in this jar is for long-term goals and shouldn't be used often.

  • Investing Jar: Explain that money in this jar will be used to 'invest' in things that might grow in value. You can simulate interest or investment returns by periodically adding a small amount to this jar.

  • Spending Jar: This jar is for immediate or short-term wants, like toys or treats.

  1. Monitor and Reflect: Regularly review the jars with your child. Discuss the growth of the investment jar and compare it to the other jars.

  2. Reinforce Lessons: Use real-life opportunities to reinforce the lessons. For example, if they want a new toy, discuss how they can use their spending jar or wait and save more in their savings jar.

  3. Adjust as Needed: As your child grows, adjust the rules and the amounts to make the exercise more challenging and realistic.


Why Investment Jars Work


  • Hands-On Learning: Physically dividing money into different jars makes the abstract concepts of saving, investing, and spending more concrete.

  • Visual Growth: Watching their 'investments' grow over time helps kids understand the benefits of patience and long-term planning.

  • Immediate Feedback: This method provides immediate, tangible results, making it easier for kids to grasp concepts like compound interest.


jars are a fantastic way to visually and tangibly demonstrate the principles of financial management to kids. They offer a clear, straightforward way to understand the growth potential of savings and investments. By actively participating in dividing their money and watching their choices play out over time, children learn valuable lessons about financial planning and the power of compound growth. This simple yet effective tool can lay a strong foundation for their future financial literacy.







family looking at investments for learning together

4. Family Investment Project



Involve Kids in Real Financial Decisions


Incorporating a family investment project into your child's financial education can be a transformative experience. Here’s how you can embark on this journey together:



Launching a Family Investment Project


  1. Select an Investment: Start by choosing a small, manageable investment. This could be stocks in a company, a small amount in a mutual fund, or even a savings bond. Pick something that aligns with your child's interests or a company they are familiar with.

  2. Research Together: Spend time researching the investment. Look at the company’s history, its performance, and news about it. This process teaches children how to make informed decisions based on data and information.

  3. Set Investment Goals: Discuss and set clear goals for the investment. This could be a financial goal or a learning objective, like understanding how stock prices are affected by market events.

  4. Track Progress Regularly: Make it a routine to check on the investment together. This could be a weekly or monthly activity. Use this time to discuss any changes in the investment and the reasons behind these changes.

  5. Encourage Note-Taking: Get your child involved by having them take notes or maintain a journal about the investment. They can write down observations, market changes, and their feelings about the investment’s progress.

  6. Discuss the Outcomes: Talk about both the ups and downs. If the investment grows, discuss what might have contributed to its success. If it goes down, talk about the factors that could have influenced this.

  7. Lessons Beyond Money: Emphasize that the value of this project goes beyond just making money. Focus on the skills and knowledge gained through the process.


The Power of Real Experience

  • Real-Life Experience: By selecting a real investment, kids get hands-on experience with the financial market, making the learning process more engaging and realistic.

  • Teaches Research and Patience: Involving them in the research process fosters a deeper understanding of investments and the importance of patience and long-term planning.

  • Family Bonding: Working together on a family investment project can strengthen family bonds and create shared memories centered around learning and growth.



Involving kids in real financial decisions through a family investment project is a powerful way to give them a taste of the real world of finance. This hands-on experience not only makes the concepts of savings and investments more tangible but also helps build critical thinking and decision-making skills. It’s an effective approach to teach important life skills while strengthening family bonds and having fun together.







kids learning investing and saving through games

5. Educational Apps and Games



Leveraging Technology for Financial Learning


In an era where kids are increasingly tech-savvy, using educational apps and games can be a highly effective way to teach them about savings and investments. Here’s how to integrate technology into financial education:



Incorporating Educational Apps and Games


  1. Select Age-Appropriate Apps: Start by choosing apps and games that are suitable for your child's age and understanding level. Look for those specifically designed to teach financial concepts.

  2. Interactive Learning Experience: Opt for apps that offer interactive and engaging activities. These could include virtual stock trading games, budgeting simulations, or interactive financial quizzes.

  3. Set Goals and Challenges: Use these platforms to set financial goals or challenges for your child. For example, managing a virtual portfolio or achieving certain milestones in a budgeting app.

  4. Discuss and Reflect: After your child uses the app or game, have a discussion about what they learned. Ask questions about their decisions in the game and how they might apply these lessons in real life.

  5. Encourage Consistent Use: Make learning a regular activity. Set aside time each week for your child to explore these apps and games.

  6. Stay Involved: Play along with them or review their progress. This not only helps you understand what they are learning but also provides opportunities for bonding and guidance.

  7. Evaluate and Adapt: Regularly assess the effectiveness of these tools. If an app or game is not resonating with your child, be open to trying different ones.



Tech’s Teaching Potential


  • Interactive Platforms: Educational apps and games introduce kids to investment concepts in a dynamic and engaging way, making learning fun.

  • Diverse Learning Tools: These tools cater to various learning styles and age groups, ensuring that learning about savings and investments is accessible and appealing to all children.

  • Accessibility: With the widespread availability of tablets and smartphones, these educational resources are easily accessible and can be a significant part of your child's learning journey.


Check out our article with the top 10 finance games and apps we recommend kids learn finance from!


Leveraging technology in teaching kids about savings and investments not only aligns with their interests but also prepares them for a digital future. Educational apps and games transform screen time into a productive, engaging learning experience. They offer a modern way to teach financial concepts, making them relatable and understandable. By carefully selecting and using these digital tools, parents can significantly enhance their children's financial literacy in a fun and interactive manner.







Conclusion


Teaching kids about savings and investments doesn't have to be daunting. By incorporating these creative methods into your teaching, you can make learning about finance both fun and effective. Remember, the key is to start simple, be patient, and make the learning process engaging. I encourage you to try these methods and see which ones resonate most with your kids. And if you've found other creative ways to teach these concepts, please share them in the comments below!



 

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