Teaching Young Children About Real Estate
One of the hardest jobs on the planet is being a parent. Whether it's changing dirty diapers or getting them to eat their vegetables, there will always be struggles.
However, there is nothing more rewarding than watching your kids grow up, overcome barriers, and develop new life skills. At some point, it becomes more than just keeping your kids healthy and safe.
As a parent, your role slowly shifts from protector to teacher, creating opportunities for your kids so they can thrive successfully on their own. As a real estate investor, one of the best lessons you can give your kids is getting them involved in real estate investing from an early age.
But motivating kids to get involved is easier said than done. If you are struggling to teach your kids about real estate investing, but don't know exactly where to start, here are five great ways to get them engaged.
Start With Savings
Introducing your kids to the value of investing starts with basic financial literacy at a younger age. Setting a solid foundation will prepare them to manage their money later down the road more effectively.
For early childhood kids, ease into the process by starting with simple savings techniques. Have real discussions about using their money for wants versus needs.
Whether you use a traditional piggy bank or a custodial savings account, leveraging the concept of delayed gratification will nurture your kid's planning and prioritization skills. It also subtly parallels investing when it comes time to implement more complex concepts.
Don't also forget to allow your kids to make mistakes. This can be especially important when teaching goal-setting techniques, which they will utilize throughout their lifetime.
Make Them Budget
Obviously, kids don't have the same day-to-day expenses as adults do. For instance, they aren't making mortgage payments or writing a check to the electric company. Nevertheless, teaching your kid about how to budget their money is undoubtedly a valuable life skill that has practical applications with respect to real estate investing.
Investing in real estate often involves figuring out your gross rent and deducting your applicable expenses to arrive at your final net cash flow. Teaching kids how to responsibly balance their spending will help them understand the movement of money.
To hammer home this concept, have older kids get a separate checking account with a debit card. Give them an allowance from doing chores around the house and then require they track their spending online or, better yet, have them complete a manual log or check register.
Play Educational Games
Who said teaching your kids about real estate investing had to be boring? A few fun ways to engage your kids while teaching them about investing is simply playing games with them.
Board games like Monopoly are a great way to empower kids to manage their finances and implement creative property management techniques. Force them to make the hard choice of putting houses on Boardwalk or trading with another player to make a more impactful set.
Construction and management games, such as the Tycoon series or Megapolis, are also a great way to help your kids understand costs and spatial awareness. It also supports the understanding of systems and reinforces planning techniques.
Ask Their Opinion
When your kids get older, a great way to get them involved in real estate investing is by involving them in some of the decision-making that goes into your own investments.
For example, if you have a problematic tenant who has trouble paying their rent or is chronically late, ask them what they think they should do.
Another example might be finding a new property to invest in. Pull up a lead and have your kid work through the numbers and formulate an opinion if a deal is a good investment or not.
Get Their Hands Dirty
It's important for your kids to realize that real estate investing isn't always clean. Sometimes it requires a lot of grit, sacrifice, and hard work.
One of the best ways to get your kids involved in real estate investing from an early age is to have them get their hands dirty. Take your kids to a newly vacated unit and have them re-paint the walls or clean the rooms.
Other tasks you could have them do include mowing the lawn or shoveling snow. Having them roll up their sleeves and work will give them hands-on experience and a better appreciation for the entire process.
