The 12-Year-Old Investor — FIRE Parents Teaching Kids to Invest, Save | Invesloan.com

At 9 years old, Ramat Oyetunji’s daughter made money cleaning friends’ and teachers’ cars in her neighborhood, put her savings into a stock portfolio, and co-published a kid’s book on money with her mom.

“If we can start our kids young, then that’s a great way to pass down that financial literacy and generational wealth,” said Oyetunji, 48, who retired at 44.

Oyetunji is one of many parents who have embraced the Financial Independence, Retirement Early (FIRE) movement over the last decade. The movement, part of the broader Financial Independence movement, stresses principles like paying off debt, long-term investing, and building passive income streams, all in hopes of retiring from a 9-to-5 job while pursuing passions like travel or financial coaching.

While much of the movement’s emphasis falls on amassing enough to retire early, some principles extend to the next generation. Half a dozen parents told Business Insider they wanted their children to be more financially savvy than they were, teaching them how to invest, budget, and delay gratification.

Some said because managing finances is rarely taught in school, they wanted their children to buck the trend and recognize the advantage of starting early.

However, some parents are split on how to best prepare their children for the financial world. Some said teaching their children financial advice early would be key to their success, though they weren’t sure how far to go without taking the fun out of childhood.

Another fear is that because they retired early or work part-time, their children may lack a model for working hard.

According to experts, simplicity wins out: Susan Hirshman, director of wealth management for Schwab Wealth Advisory, advised parents to introduce money lessons through “simple, practical ways,” such as allowance, budgeting, and goal setting.

“The most effective lessons often come from daily life — whether it’s setting a savings goal for a concert ticket, comparing prices while shopping, or helping plan a family vacation activities based on a specified dollar and time budget,” Hirshman told BI. “These hands-on experiences build confidence and set the stage for smart financial decisions down the road.”

Starting their children young

Oyetunji grew up in Nigeria and moved to the US at 20 to finish her studies in mechanical engineering. She started her career working on offshore oil rigs before transitioning to working as a process engineer, vaccine manufacturer, and closing out her career as a quality director at a chemical company. Along the way, she adopted principles of the FIRE movement.

Oyetunji, who lives outside Philadelphia, retired at 44 with a seven-figure net worth. In her spare time, she continued building her company The FI Woman LLC, which she started in 2015, and wrote books on financial planning. She said her early retirement has allowed her to spend more time with her family and community and teach her daughter financial literacy.

Oyetunji found that the most effective way to teach her daughter is through daily tasks. For example, her daughter plays Minecraft and Roblox, so Oyetunji suggested she buy shares in the games’ publishers alongside other blue chip companies to understand how stocks are connected to the real world. She also gives her an allowance to help her understand budgeting.

Brennan Schlagbaum’s 1- and 3-year-old daughters are too young to start buying shares in companies, but he’s started investing on their behalf. The self-made millionaire, who quit his day job to run a financial literacy platform full-time, said they both have a 529 plan, a brokerage account, and a Roth IRA.

He and his wife Erin opened a 529 plan, meant for education expenses, for their daughters before they were even born. The Dallas-based parents contribute about $250 a month, which they settled on by working backward from their goal: to cover 60% of the cost of an in-state, public university.

“They’re required to handle the rest, whether it be a scholarship or paying their way,” said Schlagbaum. “We want them to have a role. They’re still going to contribute and understand its relevance.”

Hirshman said parents should ask themselves if they can afford financing college for their children without losing track of their financial goals, then determine how they should encourage financial responsibility in their children.

“It is so important to understand that a person’s relationship to money and wealth starts with their experiences in childhood,” Hirshman said. “Teaching children about money shouldn’t be about placing pressure on them — it’s about equipping them with tools to make confident, informed choices as they grow.”

They also contribute about $250 a month to the two brokerage accounts that are earmarked for each daughter. Schlagbaum said they plan to gift them that money in their 20s when they start looking for houses or opening a business.

As for the Roth IRA, a retirement-specific account, the account holder must have earned income to contribute. Schlagbaum contributes any money his daughters earn from baby modeling into their Roths, he said, to “get that compound interest rolling at a very young age.”

In the meantime, he’s starting to familiarize them with investing terms.

“Recently I sat them down and I was talking to them about what we’re investing in my solo 401(k),” he said. “Obviously, they had no idea. But it was just to introduce them to the subject.”

Teaching by example

For some FIRE parents, demonstrating techniques for financial success is more powerful than teaching their children about advanced economics.

Cha’Lea Stafford, who quit her sales job to pursue a more entrepreneurial career, didn’t learn about personal finance growing up.

“I was born into a world where survival came first,” said the podcast host and online course creator. “My family arrived in Georgia with nothing. We were homeless, living in a shed behind the farmers market where we sold produce.”

Her two sons, 11 and 17, are both entrepreneurs. They first learned about business basics, and she encouraged her oldest to start a lemonade stand. Her youngest, a toddler at the time, observed, wanting “nothing more than to be like his big brother,” she said, and started his own entrepreneurial career.

His first venture was selling books to neighbors out of a red wagon. He’s also done mailbox makeovers for neighbors and created an online course to teach other kids how to make their first $500.

“My sons now understand money in ways I never did at their age,” said Stafford, who is saving and investing aggressively to hit financial independence. “They invest. They create as budding entrepreneurs. They see wealth as a tool, not just a number.”

Susan Cesarini, 57, has made it one of her goals to teach her grandchildren to know the value of a dollar.

Cesarini ran a cat grooming business before retiring at 50, though she unretired during the pandemic after feeling she lost her sense of purpose. Despite retiring with a seven-figure net worth, she restarted her business at half the size and set boundaries on when she works.

Cesarini said she didn’t have the time to educate her children on financial advice, as she worked multiple jobs as a single mom. Instead, her children followed her lead and lived frugally.

Cesarini is now guiding her grandchildren more directly. She’s taught her 12-year-old grandson about compounding, putting your money to work by investing, and the difference between a “need” and a “want.” She’s taken her grandchildren to thrift stores so they know how to look for cheaper options and she encourages them to fix things on their own instead of hiring someone. She used her own property, which they painted with her, as an example.

“Seeing me work hard, seeing his mom and dad work hard, I think he wants to work hard and learn new things,” Cesarini said. “I definitely see property flipping in his future.”