Investment Article - Investing and Your Kids, A Million Dollar Tip

It is always so much easier to look back and see how we might have done things differently versus having to make a decision without hindsight. Hence, the old saying hindsight is 20/20. Well, why not combine the best of both worlds.

As a kid, we absorb information like a sponge and one of the most prominent sources of information is our parents. Now what if I told you that you could teach your child to become a millionaire. All it takes is discipline, time and $50 a month. If you can start investing for your child at age 9 and continue to invest $50 a month earning a 9% rate of return, your child will have over 1 million dollars at age 65. Of course, you probably won't continue to invest $50 a month for your child until he/she retires, but hopefully you can pass the lesson on to your child to continue investing for his/her future.

While there is no guarantee you can earn 9% a year, this is a reasonable expectation of long term investing. The historical average of the stock market is around 10%. If you can somehow earn a higher rate of return or invest more than $50 per month the final value of your child's account at retirement would be increased significantly.

Finally, it doesn't take much to save $50 a month. Maybe you decide to eat out a couple times less each month. Maybe you bypass a few morning coffees. Regardless, almost anyone can set aside $50 a month even if it means making a couple sacrifices. After all, isn't it worth it to help ensure your child's future?