SG Budget Babe
Asked by Anonymous
Asked on 21 Nov 2019
He's 15, and despite him showing me multiple reports about how crypto is the future of finance, I'm still skeptical. Do you think that I should support him in this endeavour?
Let me be frank. I got a few friends also showed my many reports and data about crypto and how fantastic it is. I almost go for it. But i didnt because i really do not understand how those things work. I cant see and feel it. It is just a virtual things for me that i dont know how to value them. True enough they got burnt.
Why not? He's young and he's idealistic, as a parent, I would support my child's dreams at this point.
But what I'll also do is to NOT support him financially, and if he really wants to put money into the markets, you can limit the amount he invests for a greater peace of mind.
He's 15 - how you react now will probably shape his impression of you and determine whether he comes to you with similar investment theories / ideas in the future. As a mother myself, I would say don't kill his spark. Let him dream - that's more important than the money.
Let me be even more extreme than Elijah, cryptocurrencies are good for speculation because they have the same financial characteristics as gambling.
So supporting an investment in cryptocurrency is like supporting your child to gamble.
However, to get some positives from his enthusiasm - perhaps you can ask him to research further to underlying the mechanics of cryptocurrencies and develop a curious/enquiring mind to come to the same conclusion himself.
Top Contributor (Jan)
I struggle to understand how crypto is considered investing. What your child is pointing to is the underlying technology behind crypto, blockchain, which has massive implications and can fundamentally change how secured transactions are done globally.
Blockchain as a technology is great, but the fundamental idea of investing is to buy into something that has a value and that can grow that value over time.
In that case, equities are backed by the company's business, bonds are backed by the issuer, etc.
Now, what's backing the actual crypto currency? Is there anything tangible behind it?
Having said that, you can speculate in crypto. There's no harm in speculating if you don't bite off more than what you can chew. But to consider it investing, is a bit of a long stretch.
Thus, I would advise that whatever your child dabbles in, be an amount that he or she is prepared to completely lose. You don't know which 'coin' will shoot up in value, but you do know that the technology and ideas behind blockchain will have the potential to be a positive impact.
There is not enough research and evidence yet to see if cryptocurrency is good or not. I would commend his interest, but encourage him to earn his own money to invest. I would not invest my own money in it.
I believe you can fully support him in the sense that you share the same enthusiasm with him, and have him to share more insights about crypto. If it falls within his circle of competence and he comprehends the mechanics of it, then why not?
But just be careful that if he decides to plunge into it for some fun to earn quick money, then you might want to exercise caution.
I totally agree with Dawn Fiona.
He has a forward thinking mindset.
Dont crush his interest just because we dont understand it or think we know better.
Rather, guide him. Give him a good foundation of education on personal finance and trading. Go to seminars with him. Active Income, Save, Insure, Invest.
Ask him, what is his strategy. Get him to give you a proposal that makes sense including strategy, risk management, accounting, test mkt results ie practise acct.
If he can handle a practise acct with realistic practise initial amount over 3 months, then let him start off with $500-1000. At the end of every month, he earns 30% comms of profits & pays any losses back to the account.
I gave my dad stock tipoffs when I was 17 & got comms when he made money from those calls lol. $30-70 extra for a student is good money 😇
Well, on one hand, I would say please support your child. It's something else to receive support from your loved ones. However, on the other hand, cryptocurrency is just gambling and speculation. There is no fundemental basis to it, you are just betting for it to go up. Even the recent bitcoin run up was purely based on "Fear Of Missing Out". Whatever reports say, those are just reports and take them with a pinch of salt (honestly and seriously, can never trust if what they say is for the people).
I would think you can listen to him on why he wants to invest in cryptocurrency etc, and at the end if you chose to support him, I would say just a small sum to "try it out". But in the long run, I highly advise against it.
I like that he's 15 and interested.
Assess his arguments, and read the reports on what he is showing you. You will be able to see if he is truly discerning, or just going with the flow of what other crypto punters say.
That said, kudos to him!
Support him, not only when he succeeds, but also if he failed. Good judgement comes from experience, and experience comes from bad judgement.
Yes! support from parents can be a wonderful thing.
Even if he fails, its good to try and fail, better than not trying and never knowing whether he did right.
I fully support parents who support their kids!
I believe the earlier and faster one fail, the better it is.
(Not saying crypto may fail... )
I will encourage him to take part time job, and to save what he can, and take 50% of savings into crypto, and the other 50% into stocks, and see how they perform 10 years down the road.
I may even match his investment $1 for $1 to encourage him.
If crypto really fail, at least he fail when he is young and with comparatively less money.
Some people are much better in life with encouragement and support from close friends and relatives.
If he succeed, well, thats a happy situation =)
Its up to you. As of now, no one has any fundamental basis to say crypto is bad or good. To me, crypto is merely acting like a pseudo currency which is backed by a group of people's trust. Truthfully it is an asset class on its own to invest.
So as a parent, its really up to you if you want to support or otherwise
Omg. when im 15, all i care is whether i can pass all my exams with flying colors. I wasnt even concern abt investing because i had no money and didnt have to worry abt money. If he's my child, i will most probably look at the entry level, platform and risk involved. If its not a scam, i will support him in terms of seminar and classes abt it. If he decides to invest, he could work part-time for the money.
As financially literate people, we all understand the concept 'time value of money'. $1 now is more valuable than $1 in the future.
I have a concept I like to tell my team, 'time value of effort'. Working hard during poly/uni times, starting companies, learning investing or honing our skills will be much effective as compared to learning them at 30yrs old.
Why? simple. The earlier you learn your skills, the longer you get the chance to use it. Right now, I have allocated a large portion of my own money (and those who believe in my team) for me and my partners to do swing trading or stock picking.
The power of students with nothing to do and strong interest is quite interesting. We are currently up 5.5% from September till November.
I digress. Your son is interested, and with proper guidance he should be able to do it well. Take it as a form of tuition fees for your son (if his asking for money), and if he wants he can contact me for additional resources on crypo-trading (I cant be bothered personally).
And if he ever does it well, I'm happy to let him join our fund, or at least talk to him.
My answer is very different from the others, but their correct in saying that crypto is a form of speculation. But with proper risk management, he can turn speculation into profits.
I wont support. It's one thing to support your kid's ideas, beliefs and all. It's another thing to have blind faith (or what ppl call "hope for the best"). If really no choice, just spare the cash that you can afford to spend, much like buying a pair of expensive -whatever- for him.
It depends what does support mean.. If it means giving him money to invest, then nah, I don't think so.
This applies to stocks, options, forex, and all other investments too. I believe people should feel an emotional connection to the money they invest/trade, otherwise they may not feel as responsible. This also applies if he is 21 or 25 or 30.
Cryptocurrency as a whole, is just a new age scammy form of currency. Should someone be investing in EURO, or Gold, or Indonesian Rupiah for that matter? The answer is, "don't know".
I personally invested in forex and lost money. Did some options writing and made money. Did speculative warrants and lost lots of money. Did long term stocks and unit trusts investment and made significant bits of money.
The point is, we don't know what the future holds. I personally think cryptocurrency (there are almost 1000 different currency/coins out there now) as a whole is a scam. It is created to sell some sexy story, or to sell a future that may or may not materialise. That's not too different to some stocks and shares to be honest. But you shouldn't put a limiting belief on your child. This may spiral to risk adversity in other aspects of life. There's nothing wrong with speculating and gambling sometimes. Most businesses and billionaires became that way because they dared to gamble. But of course, in a well researched manner.
And to reiterate, you should NOT support him financially. At least if you want to, make sure he puts in his fair share so that he will feel the pitch.
If your son is that enthusiastic about crypto, consider asking him to learn how to trade crypto instead of investing in crypto. Returns may be more consistent this way. You may want to set aside a small amount for this though and not go all out.
I've dabbled in some ICOs in the past and basically wrote off the amount I put in.