Investing for Teens: What They Should Know
Economics is a central element of individuals’ lives nowadays, and investing is an important tool that can help teenagers create the best financial future for themselves. Starting early enables teens to build on compound interests and, more importantly, cultivate good financial foundations. Here’s what teens should know about investing: 1. Understanding the Basics To begin with, teens should know the basic concepts of investing, which are briefly touched on here. Investments can be anything from stocks and bonds all the way to mutual funds or actual property. It is also important to understand that every type of investment has corresponding levels of risks and benefits. Stocks are ownership certificates in companies, whereas bonds are debt instruments offered to companies or governments and mutual funds are investments in which many people contribute their money to be used in buying several assets. 2. The Power of Compounding This is one of the most significant benefits of, for ex...