Teaching Your Kids and Grandkids About Investing

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How do I teach my kids and grandkids about financial literacy? You should start by instilling the duty of ownership through diversified market investments, such as an S&P 500 index fund, which allows even young investors to own pieces of corporations. Public education systems often fail to teach basic money management, thus, responsibility falls on families to host annual meetings and explain concepts like compound interest—the element that allows wealth to double approximately every eight years historically.

In the 2026 landscape, a key focus is understanding the difference between being a "Loaner" (Bonds) and an "Owner" (Stocks) is critical for young adults: bonds offer a known outcome with fixed interest, while stocks represent an investment that allows participation in innovation and growth. 

Financial success also hinges on identifying the difference between good debt and bad debt. While credit card debt and payday loans are "bad debt" that should be avoided at all costs, a low-interest mortgage (such as those secured at less than 3% during the 2020-2021 window) can be considered "good debt" if managed with discipline.

Key Learning Outcomes
Generational Duty: Why parents and grandparents must bridge the gap left by public financial education.

The "Trump Account": Preparing for the July rollout of this new long-term compounding tool.

Market Psychology: Learning to view stock prices as only a potential loss or gain and how to avoid emotional decision-making.

Debt Management: Why "no bad debt ever" is the fundamental rule for relationships and financial peace.

0:00 Why is Financial Literacy Important?
1:49 The Role of Parents & Grandparents in 2026 
2:50 July Update: The New Trump Account for Long-Term Growth 
4:35 What's the Difference Between Stocks and Bonds?
9:17 Temporary vs. Permanent Loss in the Market
11:15 401(k) Strategy: Matching, Cash Reserves, and Roth Options 
13:44 What is Good Debt vs. Bad Debt?
17:32 The 70-20-10 Budgeting Rule for New Grads 
22:37 What Does a Financial Advisor Do?
28:06 Family Finances: Having the Hard Meetings 
32:22 Why is Portfolio Diversification Important?

Sources:
Insights provided by Dave Petso, CFP® and Dean Barber of Modern Wealth Management.

Vanguard, Fidelity data show new record highs in 401(k) savings
https://www.investmentnews.com/retirement-planning/vanguard-fidelity-data-show-new-record-highs-in-401k-savings/265542 

Kiplinger Article: What Is the Rule of 72 and How Can Investors Use It?
https://www.kiplinger.com/investing/what-is-the-rule-of-72#:~:text=What%20is%20the%20Rule%20of%2072%20in%20simple%20terms?,divided%20by%20nine%20equals%20eight). 

Nebraska Dept. of Banking and Finance Website: Doubling Your Money With the ‘Rule of 72’
https://ndbf.nebraska.gov/doubling-your-money-rule-72#:~:text=How%20It%20Works,Understand%20your%20risk%20tolerance. 

Article: Down 25% From Its High, Is Now the Time to Buy Microsoft Stock?
https://finance.yahoo.com/news/down-25-high-now-time-012000490.html 
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Investment advisory services offered through Modern Wealth Management, LLC, a registered investment adviser.
The views expressed represent the opinion of Modern Wealth Management a Registered Investment Adviser. Information provided is for illustrative purposes only and does not constitute investment, tax, or legal advice. Modern Wealth Management does not accept any liability for the use of the information discussed. Consult with a qualified financial, legal, or tax professional prior to taking any action.