If you can teach your kids just one thing before they grow up and leave the house…

…what would it be? Don’t lend money. Don’t get drunk unless you’re surrounded by friends who won’t leave you behind. Keep your pants on.

Or maybe this:

Back in 1950, when he was just starting out in life, assume your father placed $1,000 in a mutual fund. Let’s say in 1997 at age 68 he retired. That $1,000 would have grown to $217,630. And that assumes he never saved an additional penny for the rest of his life. Who needs Social Security?

If starting in 1950 your father had put $1,000 every year into a stock fund paying an average rate of return, he would be very rich today. The stock fund would be worth $1.85 million.

The magic of compound interest!

The thing is, when you’re young, you don’t have much money. I never had a real savings account until I was…oh, about 30. It was paycheck to paycheck before then, even after I had kids. Except for the periods of my adulthood I spent living with my parents, I never had any money to put away.

Except, you know, I did. I could have. If I’d really wanted to. I’m doing so now – now that my income is higher. Now that retirement and old age look more like things that are actually going to happen in my lifetime.

They didn’t look like that when I was 18.

Oh, but investing is so dangerous!

Right. From the same article:

Siegel reports that for from the day the New York Stock Exchange opened its doors, through the end of 1997, the average annual rate of return on stocks has been more than 10 percent. Siegel finds that there has never been a 40 year period in American history when the markets have deviated significantly from that long-term trend.

Compound interest. I want my kids to learn it.

So how do I do that? Encourage them to save $84 a month between their 18th and 19th birthdays, and invest in a mutual fund. That’ll be $1,000 over the course of a year.

Although…even $20 a week is a lot to a teenager. Hey, I could just give them the money. It’s a relatively small amount, and would give me a lot of peace of mind.

Although…yeah, there’s that “teaching them to make it on their own” thing.

Okay, so: I’ll match every dollar they invest, up to the first $1,000, as long as they do it before they turn 19. That’ll double the investment. Even if they never invest another dime, they’ll be a lot better off than most.

As long as Obama and Reid and Pelosi keep their filthy hands off it.

Plus, having that money in the bank will make it more likely they will invest even more. Having money does that to a person.

Awesome. It’s settled. Now don’t anybody say anything until I’ve had a chance to tell my wife.