By the time you begin explaining money and finances to your child, you’re probably already saving for his or her education. Even though you’ll continue making decisions about those investments for years, get your child involved early.

Consider a family game to stimulate your child’s interest in investing. Encourage family members to pick a stock for a company with which they are familiar, such as a fast-food restaurant chain or a company that makes sneakers. Give out play money so that everyone can make an initial "purchase" with $1,000. Track the stocks for three months.

When the game is over, discuss how research about the choice of stocks might have helped everyone make better investments. The prize might be a family night at a movie chosen by the person whose stock has the greatest market value.

As your child grows up, you can gradually introduce him or her to a variety of investment options, such as stocks, bonds and mutual funds. To help your child understand these options, or to brush up yourself, check out the sources in For More Information.

Privacy Issues
Every parent has a family horror story about children repeating in public something they heard at home. Before you begin talking about your family’s finances, stress to your child that such information is private. In addition, explain that not everybody has the same amount of money. The financial circumstances of your family may vary greatly from those of your child’s friends. Some friends will have more, others less. Encourage your child to be sensitive to these differences and only discuss money in general terms. Let your child know that it’s not OK to make judgements about others based on their financial circumstances.

Helping your child understand money requires some time and effort, but it can be a rewarding responsibility— one that enhances his or her chances for success. Each family has its own set of values and opportunities. Select the financial lessons you want to share, and help set your child on the path to future financial security.