How to Teach Kids About Investing

Keep lessons simple and get kids started by buying shares in a company that interests them.

Recently I had a conversation -- actually, more of a disagreement -- with my 25-year-old son about how to invest. Peter will be starting a new job soon, and I was emphasizing how important it is for him to contribute regularly to his 401(k) plan and, at his young age, tilt heavily toward stocks. Peter disagreed. With the market hitting record highs, he thinks there’s a good chance prices will fall. He argued that it would be smarter to bide his time and buy on a market dip. I pointed out that while that makes sense in theory -- at least for a portion of his money -- spotting the dip and making a move at precisely the right time has tripped up many an investor.

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Janet Bodnar
Contributor

Janet Bodnar is editor-at-large of Kiplinger's Personal Finance, a position she assumed after retiring as editor of the magazine after eight years at the helm. She is a nationally recognized expert on the subjects of women and money, children's and family finances, and financial literacy. She is the author of two books, Money Smart Women and Raising Money Smart Kids. As editor-at-large, she writes two popular columns for Kiplinger, "Money Smart Women" and "Living in Retirement." Bodnar is a graduate of St. Bonaventure University and is a member of its Board of Trustees. She received her master's degree from Columbia University, where she was also a Knight-Bagehot Fellow in Business and Economics Journalism.