Then orchestrate an artificial bubble and crash
“The first national bank of dad” is a book that suggests a similar approach and I believe it also advocates a 15% interest rate.
https://www.investopedia.com/ask/answers/042415/what-average...
And on top of that there's huuuuuuuuge variance over time. You have to scale in and out of the market over a very long time to actually get the ~7%. Any one time investment is just a straight up gamble. It's only in aggregate over a long time that you get something somewhat reliable. But then the numbers aren't that impressive. I understand why people are so fond of buying bigger or second houses instead. It's a shame because it drives up the price of housing making it less available for our young. We're basically saving for our future by robbing the future of our young. It's pretty dark to be honest.
But without leverage, long run return of residential real estate is like 3% after costs, which is less than equities but above bonds.
At least that’s what I tell myself as I go to sleep in my apartment, a non-homeowner watching people accumulate serious paper gains in their houses ;(
Source: a paper called the real return on everything.
The paper "the real return on everything" notably cuts off in 2010 and is talking about global averages, if you narrow it down to specific countries we can see stark differences. In the USA and UK you get 8.4% and 7.2% returns on equity, but only 6.03% and 5.36% returns on housing, a stark difference. Adding in mortage leverage adds on about a percent or so of return, thus still not bringing housing in-line with equities.
If we narrow our window to post 1980, we see in the UK returns of 9.34, 6.81 and 6.67 % for equity, housing and bonds. If we look at post 2010 in the uk, house prices have only stayed the same or decreased in real terms since then in the uk for instance, whilst equities have soared.
They also in the paper assume bond yields are roughly the same as mortage interest rates, which maybe was true for their data period, but hasn't been true since 2010 (https://www.housepricecrash.co.uk/forum/uploads/monthly_2022...)
Finally you can diversify equities globally, you cannot diversify your housing globally (if using leverage in a mortage).
Effective interest rate is something like 7-10%
> As my eldest son’s birthday was approaching, we suggested that instead of asking for physical gifts, he ask for their equivalent in money. That way, he gathered a decent amount of capital for his first investment adventure.
Yes, why would you want a toy or a book? Why waste time having fun or learning? You could instead watch a number go up slowly while you do nothing. Fun for the whole family, seconds at a time!
> Each day, as they watch their small fund grow, they grasp the magic of compound interest — and that, more than any gift, is a lesson I hope will stay with them for life.
This feels like raising finance dude bros and gambling addicts. There is no “magic” to compound interest, no one should have “watch money accumulate” as a life goal.
That’s not what the article says. I explicitly quoted the relevant part. It’s not “a portion of their money”, this is not money they had lying around in an envelope that grandma gave them. This father is incentivising the kids to not get what they want for their birthday and instead ask for money with which they’ll do nothing but unrealistically watch grow for a period of time. That’s not a good core memory, no one looks fondly on “that birthday I had as a kid where I got nothing but a number on an app stated growing at a snail pace”.
> doesn't suddenly make investing bad.
That’s not the argument. Nowhere in my comment does it say investing is bad.
> This is such a wild take.
Any take is wild when you blatantly misrepresent it. Don’t straw man.
Also, learning to use Excel by playing fantasy stocks during the dot-com bubble, and having a Lycos homepage “Portfolio” widget just like my mom did is a fond memory for me, and zero people on Earth would call me a finance bro today.
> we suggested that instead of asking for physical gifts, he ask for their equivalent in money.
For their equivalent. In other words, the kid has to decide something they want then deliberately choose to not get it so they can “invest” it and see line go up.
It would’ve been different if this had instead been a case of “grandma just gave you an envelope with cash; if you don’t have plans for it, how about investing?”. Which works on many levels, they could’ve also spent some portion of the money on something they wanted then invested the surplus, or a myriad other options.
This seems hyperbolic. Given that money doubles in roughly 10 years at a 10% rate of return, if kiddos are 10 years old they get two doublings by 30. To be a millionaire by 30 requires a present value investment of $250k per child.
yeah definitely no learning happening here
> You could instead watch a number go up slowly while you do nothing.
and then...spend it on something nice?
> This feels like raising finance dude bros and gambling addicts.
This is a super reactive take speaking from no experience whatsoever. My own parents did something like this for us when we were in elementary/middle school and it taught me restraint in spending, not the opposite.
You have no idea what my experience is, please don’t assume.
> My own parents did something like this for us when we were in elementary/middle school and it taught me restraint in spending, not the opposite.
I’m glad it worked out for you. Truly. But don’t assume your experience is universal, because I unfortunately know for a fact it’s not. Also, the argument isn’t that it causes unrestrained spending, that’s not what financial dude bros are about. Excessive restraint in spending can also lead to unhappiness and an unhealthy attachment to money.
Are they actually investing anything? If so, wouldn’t the app for the brokerage do this with real numbers?
Do you deduct short term and long term capital gains taxes?
- react app - pwa manifest - tailwind css
This is not at all a "plain html" file.
My firewall shows blocked connections to cdn.tailwindcss.com and unpkg.com
EDIT: I wouldn't have expected external dependencies, though.
The AI just picked react because that’s the most common framework.
I mean nothing wrong with that, I needed a silly calculator thingimabob too yesterday (for some CRC checks on a piece of text) and Claude quickly cooked something up for me.
But I'm not writing blog posts about it, releasing the tool in the wild, and claiming I wrote it. Blegh.
<link rel="canonical" href="http://localhost:8080/en/dinversiones" />
Author then proceeds to put 15% annual interest rate...
11% may be the safest bond you have access to, but that doesn't make it _safe_ in absolute terms.
Imagine you have a scenario where inflation is 0 in currency A and 10% in currency B. Would you rather have a 2% bond in currency A or a 9% bond in currency B? This is why Euro bonds go negative sometimes, when USD interest rates were very low and the Euro was deflationary relative to the dollar, it could push rates even further lower.
I used to know an adult who only cared about that number going up, despite making more than a comfortable amount of money. Live with parents, save on rent/mortgage, number goes up faster. Buy cheapest food, take leftovers from work-catered lunches, number goes up faster. Scam your way into being hired for a position you are severely underqualified for, get terminated after three months, keep the salary and sign-on bonus, number goes up. Invest pretty much everything (because there are almost no expenses), compound interest.
Can we stop with this myth? Most states require financial literacy courses to graduate. The reason it feels like it isn't happening is because it's boring and most just don't pay attention or absorb the lessons.
What's a state? Pretty sure we don't have those here.
Even if it was true for America (probably not), it certainly isn't true for the entire rest of the world.
Maybe they should be teaching Geography.
It's apparently now 30 states.
But going from "it's not a requirement" to "the class is awful" would kinda be moving goalposts, no?
Prior to 2020 only 8 states required a standalone financial literacy class. So a good percentage of people from the US on here probably didn't have to.
There were also states that had it integrated with another course but I'd question if they were any good. My state was like that and all we did was a 2 week project where we pretended to trade stocks starting with $1k. Which didn't even include things like dividends, short vs long term capital gains tax, etc...
We weren't taught basic things like budgeting, planning for emergencies, how loans and interest work, how taxes work, how credit scores work and affect you, etc...
I might be wrong, but reading this, I couldn’t help but think: if we’ve reached the point where we’re building apps to get our kids into investing, maybe we’re living through our own “barber moment.”
I'm sure Mr. Rothschild would be fine with this learning tool.
Reality: Dump everything into Nvidia / S&P 500. Number go up.
There is no such thing as "growth detached from value" lasting forever.
Still, if a 10 year old had started investing 10% in the market in 1920 and stuck through it during the depression, even with no income coming in at the time, they would have done handsomely through the recovery and into old age. In fact, a middle aged person who had been investing until 1929 would have not been fully cleaned out, and that money would have recovered its value by 1943. Margin was what killed fortunes in the day, so the lesson to learn is to avoid margin for your investment portfolio. (Speculation is a different story).
Even George Hotz understands this is the symptom of a larger issue and it is going to end bad: https://geohot.github.io/blog/jekyll/update/2025/10/24/gambl...
I knew I wanted to save a lot for my future and retirement since I was in high school. I didn’t gain any reasonable ability to do so until much later.
A much better life skill in my opinion would be to teach about budgeting, how to cook economical meals, how to avoid debt traps and lifestyle inflation.
That said, I don't think knowledge of investment gets you very far if your job pays subsistence wages. I worked for a popular fintech focused on personal investment and their narrative was essentially "financial freedom through investment". I think it's important to understand that even the most sophisticated knowledge of investment and personal finance does nothing substantial if you aren't making surplus money to begin with.
With my tinfoil hat on, I feel like that is by design.
Yes, there are people who don't invest. Where do they keep their retirement savings? 40-50% of Americans, at least, simply have no retirement savings! Most people in America aren't earning enough to put away a meaningful amount for retirement. It's going to be grim as boomers and millennials hit retirement age and have to keep working.
Rest assured it usually isn't their choice.
People choose to marry, have kids, and buy a house.
1 in 5 have $0
50% have enough to cover 3 months of expenses
The problem is many kids don't have much money to save or invest. Or if they do, real banks kinda suck when you only have a kid amount of money ("Here's the 0.2% interest on your $37 balance"). So they can't apply what they learned. An app like this, backed by the Bank of Mom and Dad, is great for practice.
I think schools and curriculums could do a whole lot better in representing this important facet of life. More broadly, I often feel that "applying all that math you've learned to real things" is a subject that could be taught.
[1] Seriously, having applied math questions like "Johnny earns X per year, with a cost of living of Y. Assuming inflation of Z and average yearly returns of R, what percentage should he be putting away, starting at age 25, so that at age 50 he essentially gets the equivalent of his own salary each month?" would likely cause some lightbulbs to go off in the kids' heads.
Of course it was. You can't teach compound interest without referring to money or banks. That's the whole point of it. Otherwise it's just multiplication.
The vicious cycle! We have to start somewhere..
If they had taught you that in high school 10 or 20 years years ago, it would be outdated by now. People used to save in savings accounts. Then 401ks. Then individual brokerage accounts with index funds. Now crypto or whatever is hot using some fintech app.
> What is a stock?
That's fair. It can come up in basic economics but not always.
When older we can teach them what capitalism considers as investment. Capitalism is a longer word for greed. Money doesn’t work. Employees do. Customers pay. Both suffer to make greedy persons rich.
Give them a piggy bank. Teaches the concept of preparation.
That's to say, I strongly disagree. It's almost never too early to teach this to children. As soon as children know money could be spent on exchange for things, they should begin to think about how money is made.
Now if only there’s an app that can teach delayed gratification.
So I say: Good on you.
Somewhat related: I just got my son set up with a custodial account and put his "kid retirement" plan into it, and let him pick a couple stocks to put some money into, and put the majority of it into target retirement and a few stocks and EFTs, so he can get some ideas of how they perform, make it a little fun with picking things he's into, and also follow ups and downs of the market, all of which I think is good education.
And I'm not even talking about what to invest in, I'm already confused at which platform/bank/whatever to do it through. The "meta", if you will. I just want to invest the 70% of my salary I don't need every month and not think about it for 40 years but how? Maybe an important detail, I'm from Switzerland, perhaps it's easier in the US with things like Vanguard.
I did this at 22, and that seed money has grown a ton.
There is no need for a big bank here, in Europe. If one of those regulated companies goes bankrupt the etf is still yours and transferable to a different institution.
War in Europe is the remaining risk factor, but if that happens it won't matter anyway.
If you start to get into truly high wealth amounts (USD$500K+) you might consider hiring a wealth advisor, who can probably do better even after accounting for their fees.
Typical options in Europe: Trade Republic, scalable, Consors Bank.
Then the usual: Around 10K where you can access it directly, a small amount in an investment with percentage (scalable and trade republic both offer that, limit there is or was 50k), rest in one broad ETF like one that follows the FTSE all world (vanguard or invesco offer that, one is bigger, the other asks for less fees).
No affiliation, and I dont know whether being outside of the EU changes things. And yes, there is the risk that we are in a huge bubble now and it popping would at first significantly lower the money put into the etf. But you certainly do have access to vanguard etc.
Have a look now and at the latest this weekend you have this solved, hopefully forever.
As a caveat your money will be in dollars and in American companies, which might not be what you want, but it's worked for me well so far
In the UK I started out using https://www.charles-stanley-direct.co.uk/ and later moved to https://www.ii.co.uk/. I initially invested in https://www.vanguardinvestor.co.uk/investments/vanguard-life... which is a fund which is available on a bunch of platforms. These days I recommend https://www.vanguardinvestor.co.uk/ to some people as an easy and low fee way of getting started with Vanguard funds in the UK.
I don't know what the best trading platform options are in Switzerland - it looks like all of the ones I'm familiar with are not relevant to you.
The key thing is you want to minimise two types of fees: * Platform fees * Product fees
For example Charles Stanley Direct charge 0.3% platform fees, and https://www.vanguardinvestor.co.uk/ charges 0.15% platform fees.
Vanguard LifeStrategy® 100% Equity Fund charges 0.22%.
The bottom line is that there are lots of good choices, and the main thing is to make a choice and get started. You can always optimise/improve your choices later.
People who try to time the market or wait for a perfect time or pick the exact right blend of stocks, on average, don't do as well as people who pick a boring index or mutual fund and forget about it for 40 years.
My BIL put money into Underarmor (he's an outdoors guy) and Electronic Arts (he's also a gamer), both of which have done good for him. My son put some money into Roblox (he's a gamer), and that's done well also.
If you max out the 3a, you can start of thinking investing elsewhere. IBRK is the cheapest to buy a US domiciled world ETF. But the UX is not super easy and you will have to fill all transactions manually in the tax report.
Neon with investments is another option I can recommend if you prefer a swiss company and a simple user interface. Fees are low if you set up a savings plan and pick one of the 0% ETFs
While the market was a very good bet for the last 50yrs, its not a guarantee.
Especially in the current climate you should be fully aware that it's significantly more risky to start investing today vs 10 yrs ago.
(Riskier doesn't mean it's necessarily a bad idea. It should just be a conscious decision under the acknowledgement that the upward trajectory is not certain. Especially in current political climate - and that "hodl"-ing doesn't necessarily mean you'll eventually get back what you invested, if a downturn manifests)
First, I don't think this absolute statement is true; I think you need to look at it from the alternatives perspective. If not investing then what? bury gold? spend it all?
Second, are we at a much riskier time than past history, both short & long term? I made significant contributions in 2014, saw 30%+ wiped out within 6 months and seen it all come back and more with the power of long timeframes.
Third, investment can take a lot of forms, not just today's hot tech stocks. I won't get into it beyond the standard think long term and avoid leverage, which seems to be completely inline with start early; start now.
But really I would recommend nonetheless staying the course with investment advice on a stocks/bonds balance relative to your age. Increasingly, the economy distributes not through labour but through capital and holding stocks is essential even with their inherent risks. Even in light of that CNN article about meme stock and crypto investors having the last laugh over the past decade, indices of ordinary large-cap stocks bring you exposure to these things.
Inflation is mainly created by this act of "putting your money somewhere". The "somewhere" your money is going into is ultimately loans. Your money is being loaned out to people, spent, deposited back into the bank, and loaned out again, on and on it goes until $1,000 turns into $100,000 in circulation, not a cent of it real until all loans are paid back.
Investing is all about that long term gain and slow growth. Having 10 years of experience after finishing college will do so much more than Robinhood for refrigerators.
My daughter I just recently set up a ROTH for her and told her I'd match anything she puts into it, and stressed she should put something into it now from her savings, and then put some of her paycheck into it, anything is better than nothing. So far she's declined the free money. I'm going to set one up for my son, once he's at the point of having an income to justify it. She's very smart, but in some ways she's very stupid.
A different reply said they waited until 26 to start - that is probably about the right time to start saving for retirement. Maybe a little late, but close enough. Before about that age you are still getting started and so you have little spare cash. You need to pay off school loans (if you took any). You need to save for down payment on a house, and buy a lot of those will last a lifetime household items everyone needs. You should be thinking about marriage and saving for it (even if you don't get legally married most people will live with someone else and should be planning on how to make that life work).
Most important: you don't know how long you will live. Save for the future, but not everything - you have no guarantee you will live to tomorrow - if you are under 60 odds are strongly in favor of it, but people die young all the time. You should have a little play money as well in your budget. Go climb Mt Fuji while your body is young and healthy enough to do so (I picked a random activity here, you should decide what you care about, not rush to Japan)
https://ibb.co/RTw5sCDJ https://ibb.co/ycRB8750 https://ibb.co/gLGQ0tKT
I should really clean it up and make a blog post about it. But wanted to share it here because this project reminded me of it :)
However, I think that's the easier part of being an investor. The more complicated part is risk management. With a savings account, there is basically zero risk. But that's not how you invest these days.
It's not zero risk:
- Your currency may collapse, see Germany 1930s, Argentina, Zimbabwe, Venezula, etc.
- Only a certain figure is protected in savings, though governments will act aggressively to protect that (see 2008 + the Icelandic/UK/Dutch palava)
A agree, that the currency is not a 100% safe investment. Inflation especially makes it bad for long-term savings. Indeed, money in any savings account is insured only up to a certain amount. However, that's not something you can explain to kids with a "virtual account." I suppose the idea that Daddy's bank will go bankrupt is probably not an ideal way to teach kids financial literacy.
I mean of course I understand that the phone can be removed by the suction mount, but thus also defeats the idle infotainment concept.
Also seen screen burn in...
How about offering a range of rates with volatility increasing as rate increases. Then they can think about the benefit of guaranteed return vs the benefit of long-term growth, or a combination of both.
cbeach•3h ago
Author understands child psychology.
You can't motivate kids by filling their heads with theory. Instead, make the outcomes of their actions visible to them - then they -motivate themselves- to learn how to improve those outcomes. Add in some friendly peer-competition and you're golden!
roberdam•3h ago
sebastiennight•1h ago
roberdam•54m ago
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nxor•2h ago