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Early Learning: How to Teach Important Business Concepts to Your Child

January 3rd, 2017 Posted in financial education, kids and money, learning about money
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It can be difficult trying to teach our children how business works, but it’s a necessary eye-opening experience that your child needs to understand. It will help them make decisions in the future, and they’ll learn to appreciate how the economy works which can be a great boon to their learning ability in the future.

Here are some of the most important concepts to teach your child, and examples of fun activities to help them understand it. These shouldn’t be aimed at children who are too young. Ideally, you’ll want your child to have a basic understand of maths first because there are a lot of numbers involved in business. You also want to have a couple of toys or video games laying around to use as “products” to demonstrate these concepts.

You’ll also need some sticky labels (that can easily be removed) and a pencil, better yet some colored pencils and paper to write things down.

How to teach business concepts to your child - young girl studying image

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Supply and Demand

To teach your child this simple concept, bring out a bunch of their favourite toys or video games and grab a couple they don’t use anymore or don’t want. Set them out like a shop, and then give your child some fake money (such as monopoly money) and offer them to your child. Set a price for each one, making sure that your child’s favourite toys are more expensive, then offer to “sell” them back to your child.

To teach them supply and demand, tell your child that their favourite toy is in high demand and that the price has increased from what the label says. Then, tell them that their other toys are cheaper because they aren’t in demand. They’ll start to understand that products that are highly sought after will cost more because they are in demand, but because there isn’t much demand for their other toys, your child can “buy” them back from you for a cheaper price.

Trading

You can teach your child to learn forex trading which will give them an insight into the trading industry and also how foreign currencies interact with home currencies. A simple way to do this is to use online programs and trial accounts. If those programs are too advanced for your child, then a simpler method is to set out a bunch of toys or games that they like to play, much like the supply and demand example. Play a simple game of trading with them. The objective is to tie in supply and demand with the toys that you have set out.

Give your child a couple of toys and set values on them. Next, tell your child which toys are in high demand (use your imagination here!) and give them reasons. For example, perhaps the latest Pokemon game came out and, as a result, Pokemon toys that your child owns have gone “up” in value, so they can be sold back to you for more money because they are now high in demand. Teach them to read how the market is going so they can buy and sell products to gain profits.

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Why Get-Rich-Quick Schemes Never Work: Lessons For Tomorrow’s Entrepreneurs

January 3rd, 2017 Posted in learning about money, millionaire mindset
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People are drawn to the idea that it’s possible to get rich quickly, especially kids. It’s a basic mammalian instinct: we want to get the most resources for the least expenditure of energy possible.

Unfortunately, the vast majority of get-rich-quick schemes don’t work, and our grand plans end up falling through. There are some good reasons for this.

Getting Rich Quick Means Being In The Right Place At The Right Time

News reporting on successful people has a tendency to bias our perspectives on how to generate wealth. The news only reports on the small cadre of individuals who made a fortune overnight, giving us the impression that building wealth is something that can happen in a matter of months. What we don’t see, however, are the millions of people who didn’t get rich quick and are working in regular businesses for regular incomes.

get rich quick? - kid in pile of money image

Pixabay

Often, the people who get super rich, like Larry Page or Mark Zuckerberg, did so because they were in the right place at the right time. Larry Page was perfectly positioned in the late 1990s to launch his search engine, Google. He had the right skills, and technology had just reached the stage where internet search was possible. The same goes for Zuckerberg: he just happened to have the right skills at the right time to implement his social media technology. These were freak events, but they’re the ones we hear about all the time in the press.

Success Takes A Long Time

There’s a joke floating around that says it take 15 years to be an overnight success. And even some of the biggest names in the business community agree with this. Many of them, including Twitter CEO, say that they had overnight success – it just took them a decade of work beforehand.

This makes a lot of sense. To build anything substantial takes a lot of time and dedication. Nothing that was complex or truly useful to other people was built over a weekend – especially in the modern world. Instead, new products and services require a long ramp up and even then they may not be accepted by the market.

Success Is Never Risk-Free

Success often means going into debt or taking on unsecured personal loans to finance a business venture. In other words, there’s an element of risk involved. The more risk, the fewer people who are likely to want to undertake the project. This is one of the reasons why we see so many people setting up their own accounting businesses (because the risks are relatively small) compared to people creating their own space companies (because the risks are much larger).

Get-rich-quick schemes like to pretend that they are risk-free: a sure bet to make money. But if they claim this, then it almost certainly isn’t true. Entrepreneurs are constantly looking for the lowest risk enterprises to sink their money into. The chances that somebody else has found one of those opportunities and wants to share it with you is next to nothing.

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Investing? It May Be The Key To Unlocking Your Future

December 30th, 2016 Posted in financial education, learning about money, Money Tips
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The future’s a scary place isn’t it. Human beings have an inquisitive nature and need to know the facts; they need the knowledge to ground them. Unfortunately, we can’t predict the future, and that’s a terrifying concept for most.

Especially when money is concerned.

Everyone wants to know that their finances will improve in the future. Everyone wants to know that their hard-earned cash is safe. There’s no straight and clear answer here, but there’s a number of things you can do to take a peek and see what the future holds.

Chief among them, is investing your money. An investment is something you put your cash into in the hope that there will be a profitable return. Simply putting cash into a savings account is an investment. Other investments are bonds, shares, and property. Running a set of investments is called a portfolio.

Unfortunately, investment isn’t risk-free. Banks can fail, and markets can fall through. That has happened and may happen again. It’s not a blind gamble, though; there is an entire archive of information available to you about investing. There’s always going to be risk, though. That’s where the portfolio comes in.

Spreading your investments across different subjects is going to not only increase your chances of success, it’s going to stabilise your income so you don’t suffer when one aspect is under performing.

Firstly, you’re going to need some starting capital to invest. Ideally, this should be around $3,500. This is so you can access the basic Vanguard funds to provide you with more options. You will need to scrimp and save to build your starting fund, and this will be hard work, but the benefits will be worth it.

investing - gold bar image

(source)

Whilst you can put your money into funds, you can also put your money into real, tangible assets. You can purchase gold bullion, which will be stored in a vault for you or you can purchase a property. Either way, they are an investment and options for diversification.

If you would like to find about more about investing in gold take a look at Gold IRA Strategy, Tips, & Rules (The Ultimate Guide) by Sarah Smith

A property investment might be a great option for you. Not only will you hold the deed to a location and a real thing, but it can constantly earn money from you. You can rent this out to commercial or residential tenants and the rent they pay back to you goes to paying off the mortgage on the site. Not only that, but the surplus is your profit. It’s a big responsibility, though, as you’ve got to keep your tenants happy, less they move to a better site and leave you empty handed. Property is huge and diverse and could see you investing into ranches and farms one year before moving over to something like a 1031Gateway property the next.

Investing is a huge world and something that never ends. Although you can’t predict where your cash will end up, it can allow you to peek behind the curtain of your financial future and allow you to have slight control over your future. Do your research and let investing give you a secure future.

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Buying A New Property? Not So Fast

December 29th, 2016 Posted in learning about money, Money Tips
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There are a few things that you’ll need to consider before you head onto the property market in search of a new home for your family. If you don’t think about these issues now, you might run into problems further down the road. Let’s look at some of the problems that you might have to deal with.

Raising The Cash

Do you have enough money to buy the home you want? You can usually buy a home with roughly five percent of the asking value. But you should really aim for roughly twenty-five percent of the asking value to put down as a deposit. This will give you access to some of the best mortgage deals on the market. That will ultimately cut the cost of buying your home in the long term.

Paying The Repayments

Next, you need to think about the cost of the repayments. Don’t forget, these can end up being a lot more than what the house was worth. Particularly, if you have to deal with nasty levels of interest. That’s why you need to check your mortgage deal carefully before you buy. A lot of people run into financial issues because they didn’t understand how much they would owe for the home.

Checking The Home

You do need to perform an extensive check on the home before you even think about buying. There can be a lot of issues, particularly with a home that isn’t brand new. The following infographic has all the problem areas that you might need to watch out for.

 


Infographic Designed By SPI Property Inspections

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Building A Nest-Egg For Your Children: How To Future-Proof Your Finances

December 21st, 2016 Posted in learning about money, Money Tips
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Scientists and technology gurus are coming up with incredible advances that are changing the face of modern medicine year on year. However, we’re all still mere mortals, and aging is inevitable. It’s healthy to live by the carpe diem mantra, and focus on the present, but that doesn’t mean that you can’t look ahead. When you’ve worked hard for years, you want to be able to protect your money and assets, and create a nest-egg for your children and grandchildren. Here are some ways you can future-proof your finances.

Making a will

There may come a time when decisions need to be made, and you’re not capable of doing this. In this case, your legal rights and choices should be respected. If you make a will, this is not just about leaving instructions for who receives what when you pass away. A living will also gives you the opportunity to give your next of kin information about what you want and how you want to be treated if you’re no longer able to make the important calls. Many people think of a will as a document that is only required by old people or those in poor health. However, it’s advisable for everyone to make a will. If you have possessions, money in the bank or business assets, this is a way of ensuring they are passed onto somebody who deserves them. If you don’t make a will, there are procedures in place, which determine who will inherit your estate, and the legal way of processing the inheritance may not match your personal preferences. If you’re thinking of making a will, click here to see what a solicitors can do for you.

the importance of making a will - financial education image

Image via https://www.flickr.com/photos/ken_mayer/5599532152

Taking out insurance

Have you got critical illness cover or life insurance? If not, it may be time to consider your options. Unfortunately, nobody knows what’s around the corner. You may be absolutely fine one day. The next week, you may find yourself with life-limiting injuries. Life is unpredictable, and it can often be cruel. It’s not possible to prevent some accidents and injuries. However, it is possible to prepare for the future and protect yourself and your loved ones from financial ruin. If you take out insurance, this provides a nest-egg for your family in the event that you pass away or you develop a serious illness, which prevents you from working. You can compare insurance providers and policies online. The process takes minutes, and it will give you peace of mind, as well as financial protection.

life insurance image - protect your money

Image credit https://www.flickr.com/photos/23765495@N08/7897518572

Every year, we read about incredible advances, which are saving lives all over the world. However, there’s no universal cure that fights every disease, and for now, none of us are immortal. It’s sobering to think of days when we might not be here, but it’s important to plan ahead, especially if you have a family. You’re never too young to make a will if you have dependents, business or property assets or cash in your account. It’s also advisable to consider taking out life insurance and critical illness cover.

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