Ep 265: Turning Teens Into Savvy Investors

Maya Corbic, author of From Piggy Banks to Stocks, tells us how to turn allowance into financial lessons. Maya dishes on the potential dangers of blindly trusting financial advisors, the future of investing, and investing for generational wealth.If you've enjoyed Talking to Teens, we'd love if you could leave us a five-star rating, and if you have time, a review! Full Show NotesInvesting often feels out of reach for teens. The stock market can seem complex and intimidating, and most kids just don’t think about their money working for them. But investing early and shifting teens’ money mindset can set them up for financial success down the road.This week, we’re talking with Maya Corbic, financial educator and author of “From Piggy Banks to Stocks: The Ultimate Guide for a Young Investor.” Maya has spent over a decade teaching kids and teens how to manage money wisely. After paying off all her debts and realizing she didn’t have to work a 9 to 5 anymore, Maya decided to dedicate her life to helping others improve their financial literacy.On the show, Maya is breaking down the basics of investing in simple terms teens can grasp. We’re discussing how to switch teens’ thinking from being consumers to being owners and investors. Maya explains what teens should learn about money before they’re ready to start investing. She also reveals common mistakes parents make when introducing kids to investing concepts.Turning Teens into Investors Instead of Just ConsumersMaya suggests reframing the way we talk to teens about the products they love to use. For example, teens may be huge fans of Apple products. But instead of seeing themselves as consumers of iPhones and Apple watches, Maya encourages teens to think like owners. They can purchase stock and actually own part of the company behind their favorite tech gadgets. This sense of ownership switches teens thinking and gets them excited about investing.Owning even just one share of a company ties teens to brands in a whole new way. And it opens their eyes to the idea that they can earn money by owning stock, not just by traditional jobs. Maya says this revelation is often the needed spark to get teens interested in investing and understanding market principles.But teens can’t just jump into the stock market without some financial literacy. First, Maya takes us through some money basics every teen should grasp.Money Lessons to Precede InvestingWhile investing early has major advantages, teens still need to learn some fundamental money lessons before they start buying stocks. Maya outlines concepts like:The difference between wants and needsHow to budget allowance moneySmart spending habitsThe power of savingHow interest worksLearning these basic building blocks paves the way for later investing success. They also ensure teens have a balanced relationship with money.Maya suggests parents invest small sums on behalf of young teens before they’re ready to make their own investment decisions. But by the time teens reach high school, they have the cognitive ability to understand stocks and start directing their own investments, Maya explains.Common Pitfalls to AvoidEager parents often make mistakes when introducing teens to investing. Investing in individual stocks instead of funds, failing to assess risk tolerance, and picking investments not aligned with the teen’s goals are a few pitfalls Maya sees parents commonly fall into.She warns that every teen’s investment portfolio should look different based on their objectives, time horizon and risk appetite. Maya advises parents help teens complete free risk assessment questionnaires rather than just telling them what to buy. This empowers teens to understand market dynamics and make informed decisions.Maya also cautions parents not to overwhelm teens with complex investing jargon. Finding relatable examples and analogies is key to getting teens excited about investing without confusing them. Comparing it to lending money and earning interest is one comparison Maya finds effective and easy to grasp.On the Show...My conversation with Maya sheds light on the immense benefits of shaping teens money mindset early on. On top of the topics outlined above, we also discuss:Getting teens interested in earning passive incomeWhy investing is important regardless of income levelDifferent investment vehicles suited for teens’ goalsResources for educating yourself about investingRealistic expectations about returnsMaya breaks investing down into understandable language. Her book and community help many parents finally grasp market principles themselves!To learn more from Maya about teaching financial literacy, visit her website at mayasmoneymatters.ca or find her on InstagramFollow us on Social Media! We're @talkingtoteens on Instagram and TikTok