The investments that set children up for wealth combine money (education and custodial accounts, property, compounding, a trust) with things money cannot buy, such as financial education, travel and a good network. The script starts from a blunt premise: the strongest indicator of whether you will be rich is whether your parents were. Whatever your starting point, the decisions you make today can change your children’s lives, and where they take it from there is up to them.
Here are 15 investments, plus a bonus, covering accounts, assets, skills and relationships.
Watch the full video here, or skip to the breakdown below.
The 15 investments at a glance
- Get them a credit card as soon as they are born (0:45)
- Open an education investment account (1:38)
- Open an investment custodial account (2:38)
- Back early-stage startups (4:03)
- Buy collectibles (5:03)
- Buy property (8:08)
- Set up a trust fund (9:16)
- Put $50 into a compound investment account (10:11)
- Invest in travel (12:08)
- Teach them about intellectual property (12:53)
- Open a Roth IRA account (13:51)
- Give them a great financial education (14:45)
- Teach them the value of money (16:37)
- Introduce them to different career options (17:44)
- Encourage their entrepreneurial spirit (19:05)
1. Get them a credit card as soon as they are born
It sounds odd, but you can add a newborn as an authorized user on your own credit card. They never use it. You can even shred the physical card. Because their name is attached, every purchase you make and bill you pay on time builds their credit score.
By the time they finish school they already have a strong credit record. The risk is real, though. If you pay late, you hand them a bad score, which the script calls one of the most damaging financial things you can do to a child.
Pay on time, every time, and they will thank you.
2. Open an education investment account
Education accounts come with incentives such as tax-free growth, and withdrawals for education are often untaxed, so they beat a traditional investment account. In the US, 529 College Savings Plans offer state tax deductions or credits. In Canada, income in Registered Education Savings Plans grows tax-deferred and is taxed at the child’s income when withdrawn.
In the UK, gains and withdrawals in Junior Individual Savings Accounts are tax-free. The narrator adds that other countries in Europe, Africa and Asia have similar benefits. You can often open the account in your own name before the child is born and transfer it later.
3. Open an investment custodial account
Education accounts are a type of custodial account, but they are limited to schooling costs. Other custodial accounts handle asset management and even retirement savings. This one is about mixing fun, learning and returns.
Kids love Disney, video games, toys and gadgets, so buy stock in companies that match their interests. Adults cannot withdraw the money for themselves, and children cannot touch it until 18 or 21, so it is protected. As their hobbies change, so will their picks, which makes it a hands-on lesson in financial responsibility.
4. Back early-stage startups
Startup investing is high risk, but it is fun and the returns can be extraordinary. As your child grows, it becomes something you can do together, since they may spot the next big thing before you do.
The video names platforms such as Seedrs, AngelList and Crowdcube for finding early-stage companies. Crowdfunding minimums often run from $100 to $1,000, so you can spread money across several startups. You buy equity in companies with high growth potential, and if they go public or get acquired, early investors see big returns that mature into wealth for your children.
5. Buy collectibles
Art, rare coins, vintage cars and model train sets can start as quirky hobbies. Niche markets have deep commitment, and their buyers spend large sums because they are obsessed, not only because they want a return. That obsession is what you can turn into an investment, and whatever the economy is doing, someone always wants it.
Rarity, cultural trends and demand drive collectible values, which is why the script calls them safe-haven assets and a real example of diversifying. If you have no time to become an expert, the script points to art, where rare pieces by well-known artists tend to appreciate and high-value deals are common.
Diversifying into collectibles also exposes your children to a different market.
6. Buy property
Alux runs an example. You buy a one-bedroom apartment in a growing urban area for $250,000, put $50,000 down and finance $200,000 at a 4% fixed rate, paying about $955 a month. In 21 years you hand it to your child, and it is worth about $432,000.
From there they can sell it and invest elsewhere, rent it out for passive income, or borrow against it to buy more property with a small down payment. It also diversifies their portfolio and gives them a tangible asset that offers safety and peace of mind.
7. Set up a trust fund
Trust funds are tied to the ultra-wealthy in most minds, but the script says they are useful and accessible to everyone. A trust can protect assets from creditors, lawsuits and divorce settlements.
You decide how and when assets reach your child, which stops them from spending everything at once. Assets in an irrevocable trust may escape estate taxes, and income from trust assets can be taxed at your child’s lower rate. The income can also give them a steady stream and some financial stability.
8. Put $50 into a compound investment account
Before you spend $50 on takeout tonight, consider that the same money can start building your child’s future. Start at birth, because compounding rewards a long period. Stay consistent, and have dividends and interest reinvested automatically.
The script compares three paths with $50 and a long horizon. A cryptocurrency fund at an optimistic 10% reaches $1 million after 45 years. An S&P 500 index fund at 7% reaches $189,629.70. A savings account at 2% reaches $43,732.83.
Time, contribution and account type all matter. The most important thing is to start where you can, stay consistent and pick the account you are comfortable with.
9. Invest in travel
The more interesting someone is, the more people want them in their ventures, and few things make a person more interesting than being well travelled. They can talk about food, languages, scenery and experiences, and connect with a lot of people.
Children who travel also tend to be more mature, independent and empathetic, which underpin good networking. The script’s line is that their network will be their net worth. Travel also exposes them to foreign currency and the global economy, so they learn early about international markets.
10. Teach them about intellectual property
It may sound too analytical for a child, but protecting ideas in a digital world can lead to large returns. If they come up with a clever name or logo for a business, they can own the IP for that name even if the business never takes off.
A unique, catchy name can interest companies that want to license or buy it, which the script says is more common than people think. A strong brand can also be sold within an industry. Some people register several names or slogans in the hope that a few become valuable, and the habit teaches children what ideas are worth.
11. Open a Roth IRA account
In the US, a Roth IRA is a retirement account where you pay tax on money going in and all future withdrawals are tax-free. Traditional accounts tax gains at withdrawal, whereas Roth accounts use after-tax money.
Many other countries offer retirement accounts with similar features. Starting early gives the money more time to compound, which raises what your child will have at retirement.
12. Give them a great financial education
Leaving all learning to school is the worst move, because schools teach almost no real-world money skills. As a parent, it is your job to cover banks, the government’s role in the economy, budgeting, saving, investing, debt, financial goals and insurance.
You learned these by making mistakes, and most people still struggle with them. Dinner-table chats and showing your children how you manage money, set goals and spend less can spare them costly errors, debt and scams. It helps them grow into financially independent adults.
13. Teach them the value of money
This is about helping children understand effort and reward. Show them the work behind earning, the point of delayed gratification and the difference between wants and needs. It also covers giving, sharing and spending in socially responsible ways.
Many parents want to give their children what they never had, and that instinct is normal. But children also need critical thinking about spending, whatever their background. They learn to work for money, to save and to spend wisely.
14. Introduce them to different career options
The narrator says parents usually do one of two things: push a path that makes the parents look good, or say nothing and leave kids scrambling in their last school years. Children need a middle ground, with exposure to options and room to explore what they enjoy, then your support to become the best at it.
People doing what they love are more likely to excel, innovate and get promoted, which leads to higher earnings. Children also lack adult inhibitions and may spot ideas you never considered. The earlier they find their interest, the earlier they meet people in the field and collect offers, sometimes before leaving school.
15. Encourage their entrepreneurial spirit
It is not all about money. Investing in creativity, problem solving and independence matters too. With your encouragement, it becomes natural for a child to spot gaps in the market and launch ventures that solve problems, which can lead to profitable, long-term businesses.
It also builds resilience and adaptability. They learn to handle business challenges, which the script calls an important part of keeping wealth.
Bonus: your reputation and network count too, because your connections open doors for them.
Start small, start early
Notice how many of these items cost little: a credit card you shred, $50 a month, a conversation at dinner. Time does most of the work, so starting early is the single biggest lever the script keeps returning to.
The bonus point is easy to miss. The friendships and reputation you build become an inheritance too, giving your children people to lean on, advice and mentorship when you are not around.
FAQ
How can I build my child’s credit score from birth?
Add your newborn as an authorized user on your credit card. If you pay every bill on time, their credit score builds without them ever using the card. Paying late hurts their score instead.
What is the best account to save for a child’s education?
Education investment accounts offer tax incentives such as tax-free growth. Examples named are the 529 plan in the US, the RESP in Canada and Junior ISAs in the UK.
How much could $50 a month become for a child?
The script’s examples at a long horizon: a savings account at 2% reaches about $43,733, an S&P 500 index fund at 7% about $189,630, and a crypto fund at an optimistic 10% reaches $1 million after 45 years.
Why teach children about intellectual property?
Protecting names, logos and ideas can lead to returns, because unique names can be licensed or sold. It also teaches them what ideas are worth in a modern economy.
Is a trust fund only for the ultra-rich?
The video says no. A trust can protect assets from creditors, lawsuits and divorce settlements and lets you control when your child receives money.
What is the most important thing to teach kids about money?
Alux stresses financial education at home, since schools teach little of it. Covering budgeting, debt, saving and investing early helps children avoid costly mistakes and scams.
Keep reading
- 15 Investments Rich People Make The Poor Know Nothing About
- 15 Uncommon Investments That Actually Make a Lot of Money
- 15 Best Books to Teach Kids About Money
