Photo by Guillaume M. on Unsplash
Many parents try their best to save or put some funds aside for their kid’s education, first car, first house, or whatever the goal might be. Most of the time parents either set up an RESP, a separate bank account or just stash money under the mattress. All of these ideas are great, and I’d encourage every parent to at least try and do something for their kids’ future. It might not always be easy, but even a few dollars a month can go a long way.
If you do have that extra little bit, and if you’re willing and able, there are many avenues that you can take. It doesn’t need to be complicated, although it can seem overwhelming at first, it doesn’t have to be. After all, education prices and the cost of living are only going up.
This is also a great opportunity to teach your kids about finances – and how the real world works.
Here are my top 3 ways to invest in your child’s future.
1. Stock Market
I’ve got to admit, I’ve created little money monsters, the kids no longer want to buy Barbies and video games, they want to invest in the companies that make these products instead. Hey, fine by me – I’m tired of stepping on Lego anyway.
The first time I bought stocks for the kids, I asked them what makes them happy – turns out it wasn’t me or Mom, it was their iPads. Yeah, yeah, bad parent alert – these monsters love their iPads. So instead of wasting their allowance on their Roblox account, or buying a new game – I got them excited about owning a very small fraction of Apple.
I bought an Apple share for each of the kids and printed off a fake certificate online. I signed their name on the piece of paper, got some binders from the dollar store, and we started collecting stock certificates.
As soon as I told my son we officially own a small part of the company, the next day at school I found out he told his best friend we own Apple – and that we probably will be moving soon since we’re going to be rich. I’m sure the teacher had a good laugh.
The Stock Market may seem like a rich person’s game, but it really isn’t – and it’s a great way to get your kids excited about investing in their future. My usual go-to advice is to talk to your bank, open up a TFSA (tax-free savings account) pick a few companies your kids are excited about – and get them to pick.
This, to me, is an easy way to get you and your kids started in the Stock Market with very little starting cash, might not be the best advice on choosing companies – but hey, we all know how hard it is to read about a company’s financial statements when your little one is trying to put a strawberry in the dog’s ear. So instead, just pick your kid’s favourites and go.
Cryptocurrencies
This one takes a little bit of time to get started, and might be a bit risky – but really can be expected to grow over the long term (purely speculation). After all, El Salvador, is proposing to declare Bitcoin as a legal form of tender, alongside the USD.
What that means is that globally, Bitcoin and other Cryptocurrencies, are starting to become more mainstream, and although they really shouldn’t be considered an investment, it’s hard to not dream that one day it can make you rich.
Start by setting up an account on Coinbase. Use my code and when you buy at least $122.91 CAD, we both will receive $12.29 CAD for free! Who doesn’t love free money?
Who knows, your kids might be buying beer with Bitcoin one day.
Real Estate
Now if you really want to take things to the next level, you can always invest in real estate. This is a great way to earn passive income if you’re not afraid of being a landlord – and all the potential nightmares that may or may not come with that.
Buy a property, rent it out until your child is ready for college, let them stay in your rental while in school and eventually pass down the title to them. This is a great way to set them up for the future, and since everyone needs a place to live eventually anyway, there’s no real loss.
Optionally, you may choose to charge rent while they are living there and secretly place it in a savings account for them (or invest in the above two options). And once they are done school, you’ll be able to hand them a nice pile of cash that you’d been secretly stashing away for them. Imagine what a head start you’d be able to provide if you could do this.
This is also a great way to kick your kids out if you’re tired of them (kidding!), and you’ll always know they won’t have a bad landlord. Unless you like torturing your kids with random visits and controlling the thermostat from your phone. Sucks to be you, put a damn sweater on!
Comment below some other tips or ways to invest in your kid’s future!
