As the UK government steps up its efforts to encourage the population to save and invest for retirement in an attempt to head off a pensions crisis for our ageing population through attractive tax breaks and the auto-enrollment scheme one U.S. start-up has taken the ‘start investing early’ mantra to a whole new level. BusyKid, an app designed to help encourage children to learn responsibility by contributing to their household’s chores rota while earning rewards from their parents, has announced a new tie-up with online investing platform Stockpile.
Parents who sign up to BusyKid are being incentivised with a $10 reward for each child registered to the app, to be invested in the stock market, free of any transaction fees. Company shares that can be invested in via the scheme include those of tech giants such as Apple and Amazon and sportswear giants Nike – all brands that youngsters will be familiar with.
The kids can buy real shares from a limited range of companies and then track how its price is moving and decide if they wish to hold, sell or trade it. The idea behind the initiative is that it both provides children with an early introduction to the world of finance and thinking about investing that they usually don’t get before they are in higher education as well as opening a door for parents to start speaking to them about money.
BusyKid CEO Gregg Murset hopes that the initiative will make a small contribution towards helping increase the likelihood of participating youngsters realising financial success in the future. In a press release to announce to launch, he commented:
“Investing is a major component to financial success, yet this is never explained to kids until they get to college … if even then. Most schools fail to teach in-depth finance, and studies continue to show that parents feel inadequate filling the void.”
CNBC coverage of the initiative tied the BusyKid and Stockpile tie-up to a study on T. Rowe Price, a U.S.-facing portal for retail investors that showed while more than 80% of parents believe it is important to talk to their children about finances, 71% are reluctant to do so. It can be presumed that the reason for this is that parents believe the youngsters won’t be interested or be able to grasp the concepts being put to them. In this context, the kind of ‘gamification’ the initiative provides could well prove to be an ingenious idea to pique the interest of kids.
How Rich People Think author Steve Siebold was also invited to provide an opinion on the initiative and provided a ringing endorsement by saying:
“giving stock as a baby gift is a great idea because even if the stock doesn’t perform well, it’s an opportunity to teach that child about money from an early age.
“Parents can sit down with their kids and show them what’s going on. It doesn’t have to be a complicated lesson in the markets, but kids will find it fascinating to know that they’re potentially making money,” he says. “Even better, you’re giving them a basic education in money and investing that will benefit them for the rest of their lives.”
We agree it’s a fascinating prospect to have a 7 or 8 year old clamouring to know in the evening how their Apple shares have performed that day!Risk Warning:
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