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.
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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.
