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Talk Stock With Your Kids >> 

What’s a stock? 

Buying stock is like buying a few orange trees in an orange grove that someone else gardens. You can buy more or sell your trees to others. If orange trees in your grove start growing better than other trees and are healthy, they’ll slowly grow over time and make them worth more than you paid. Then when the time is right, you can sell some of your trees and use that money for something else, or to help someone.

Children can learn the basics between compare and contrast at an early age. Walk around the grocery store, toy store, or Amazon mall and point out brands your child knows and talk about the product and its parent company.

Explain to your child (in an age-appropriate way):

  • Small brands are often owned by larger companies.
  • The parent company owns several brands in the same niche but target different segments of the population to get a bigger overall market share.
  • Investing in stocks is the same as buying small pieces of a company.
  • A lot of people, like to buy shares in companies that are household names, have a solid reputation, and great growth and earning potential.
  • Examples of large parent companies owning smaller brands:
    • Yum Brands: Kentucky Fried Chicken, Taco Bell, Pizza Hut.
    • Gap Inc: Gap, Banana Republic, Old Navy, Intermix and Athleta.
    • Hasbro, Inc: Hasbro, Playskool, Tonka.
    • Mattel, Inc: Mattel, Fisher-Price, Mega Brands, Fuhu.

And Learn a Little More!

Children can learn the difference between wants and needs at an early age. Put sticky notes throughout the house on items and services that come from publicly traded companies. (This activity is also a wonderful way to explain where money is spent!)

Showing kids which companies provide the assorted services we use helps them to understand that every family, every person is part of a larger community, and that people work at these companies to help keep the community run smoothly.

  • Talk to your kids about the different companies represented in your house.
  • Is it a company that provides a need or a want item?
  • Is it a service we use all the time or only a few times a year?
  • Is it something we can live without?
  • Examples of companies:
    • TV (examples: Spectrum, Direct TV, Dish).
    • Cell phone (Verizon, Sprint, AT&T).
    • Lights/electricity (SCE).
    • Appliances (GE, Whirlpool)

Is Your Child’s Interest Growing?

Children learn the basics of charts and graphs early in elementary school. Look at charts and graphs of their favorite companies.

  • Talk about stock prices in correlation with seasons and product rollouts.
  • They will be able to identify when a stock price is going up or down.
  • Read the headline news of each of the companies and see if you can match the news with a movement in the stock price.
  • Talk about how the stock has performed over the past month, year, and five years.
  • Discuss if you should look at short term movements or long-term movements.
  • Compare the charts of your child’s two favorite toy companies.
  • How do the charts compare, do they have the same movements? Why/ why not?

Source:  https://mamainthenow.com/teach-kids-stocks/

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