As parents, we strive to teach our children essential life skills—how to ride a bike, cook a meal and manage their time. But one topic that is often overlooked is investing.
Understanding how to grow money over time is a valuable skill that can set kids up for long-term financial success. By teaching children about investing at a young age, you help them build healthy financial habits, develop patience and understand the value of long-term financial planning.
In this guide, we'll explore age-appropriate ways to introduce investing concepts to kids and teens—plus resources that will help drive the lessons home.
Why Teach Kids About Investing
Investing isn't just for adults with extra money; it's a fundamental part of financial literacy. Teaching kids about the concept early can help them in innumerable ways down the line as they earn disposable income.
Investing can feel like a scary topic even for adults. If kids feel like they have even a basic grasp of company ownership, types of investments and the financial markets, it could empower them to feel more comfortable handling money as they grow older.
Investing also encourages long-term thinking. Teaching kids about how you can increase the value of your money by investing it is a fantastic way to demonstrate the power of patience and goal setting.
How To Teach Kids About Investing By Age
Ages 5-11: Understanding the Basics
At this stage, kids are just beginning to understand money. They may recognize coins and bills, but the concept of investing may seem too advanced. The key here is to introduce simple ideas in a relatable way.
Teach Them About the Value of Compounding Interest
A concept that may blow kids' minds is the fact that the value of a dollar doesn't stay static; rather, it fluctuates with inflation and the market. That's why it's important to place your funds in accounts and investments that help your money keep up. Enter: compounding interest.
A great tool to use to help them understand the value of compounding is our Benefits of Compounding financial calculator. This can help visualize the growth that your money experiences when it's placed in an account with competitive interest rate.
FYI: our eXtras Student Savings account earns 3.00% APY* on balances up to $1,500†. You can plug this interest rate into the calculator to show your kids how their money with Apple FCU is growing over time.
Play Games That Teach Investing Concepts
Kids learn best through stories and games. Tapping into their playful side can help them grasp some of these difficult-to-understand concepts.
There are plenty of online games and resources that help kids learn about investing and even allow them to practice investing in stocks, bonds and mutual funds. Among the most popular are How the Market Works and Build Your $tax.
Ages 12–14: Introducing the Stock Market
As kids enter their preteen years, they start to grasp more complex financial concepts. This is a great time to introduce the stock market in a simplified way.
Explain Stocks and Ownership
By their pre-teen and teen years, kids will have heard about the stock market, but they may not fully grasp the concept of stocks or what they represent. This is the time you can discuss the markets with them and how they relate to business and portfolio performance.
One of the best ways to teach kids about stocks is to compare them to something they love. For example, if your kid loves Disney, explain that Disney is a company that sells shares (stocks) to investors. When people buy stocks, they own a tiny piece of the company. If the company does well, their investment grows. If not, their investment shrinks.
Set Up a Mock Investment Portfolio
At this age, one of the best ways for kids to learn about stocks and market investments is by creating a pretend investment portfolio. Having them "invest" pretend money helps them see the impact of their choice over time.
There are several online stock market simulation games online, such as the Stock Market Game, that allow kids to build a fake portfolio and watch it perform. Have them pick companies they recognize and track the stock market with them each week. You can even chat with them about how the news cycle impacts company stocks.
Ages 15–18: Getting Hands-On Experience
Teenagers are old enough to start learning about real investing tools and strategies. This is a great time to help them open a low-risk or risk-free investment account of their own.
Teach Them About Different Types of Investments
Your teen may associate investing with only the stock market. Go beyond stocks and teach them about other types of investments, such as:
- Bonds
- Mutual Funds and ETFs
- Retirement Accounts (like a Roth IRA)
- Certificates
- Real estate.
Encourage Long-Term Investing
Many teens think of investing as a get-rich-quick scheme. In fact, many teens—and adults—become frustrated when their $100 investment doesn't flip into $1,000 within a week or month.
The most important lesson that you can impart about investing is that it is a long-term growth strategy, not a quick gamble. Gambling may be more exciting, but investing is more likely to pay off over the course of years or decades.
Sit down with your teen and help them make a goal for their investment, maybe saving for college or buying their first car. Then help them set up a beginner-friendly investment account—like our 12-Month Starter Certificate.
Set Your Kids Up for Financial Success with Apple FCU
Teaching kids about investing isn't about making them experts overnight—it's about planting the seeds of financial literacy. The earlier they understand the value of investing, the more confident they'll be in managing their money as adults.
Start small, keep it engaging and lead by example. Whether it's an eXtras Student Savings account for a five-year-old or a 12-Month Starter Certificate for a pre-teen or teenager, every step you take helps build their financial future.
Want to help your child build smart money habits? Learn more about our offerings for students at AppleFCU.org/Students.
*APY = Annual Percentage Yield. APY is subject to change without notice. No minimum required. All rates are effective as of 03/01/2025.
† Balances over $1,500 will earn our Regular Savings dividend APY.
