Hi! My son has a penchant for negotiation and money. It's weird but good. He wants a Nintendo Wii, and I am not going to be the mom who has him have 1 of each expensive toy at each of his parent's house.
So we're doing a lemonade stand, with lots of bonus "products", e.g. Superhero high-fives, Taekwondo demo, palm reading etc. Each service comes with a charge and I'll be there the whole time. He will also have a tip jar. I'm teaching him about marketing. We are doing signage, flyers and social media promotion.
My question is this: I'm teaching my son about raising capital first. Next, I'll teach him about savings and interest. Then, returns & risk.
I plan to teach him about savings & interest by offering a 3$/weekly contribution to whatever money he raises. The longer he saves it, the more he'll have. Lesson one.
When we either take his money out of his mommy fund, I'll have him make a choice to re-invest it in another way, or to invest it in something else (teaching about risk and returns). In one scenario, I'll teach him that a high rate doesn't always mean a safe investment. In another, I'll offer a moderate return.
Thoughts on how to teach a 5yo about evaluating different investment options? The latter is a toughie. What are some simple scenarious that would help me show a 5 yo risk and return?