How to teach kids to recognise financial risk: the mindset, habit and simple game that help them spot a dodgy deal before it costs them a single rand
Chances are your mini millionaire will bump into a risky financial play long before they even get their first payslip.
It could come in many forms, like a crafty classmate's "double your money by Friday" promise during break, or a flashy offer they receive on WhatsApp, or even an app dangling easy wins in front of their eyes.
The thing is, there's nearly always an element of risk inside every money decision we could make, so it’s well worth teaching our mini millionaires how to spot the risk.
This week, we’re unpacking three simple ways to help them read what's really on the table.
Risk isn't the enemy. Not seeing it is.
When we hear "risk", we usually picture something bad.
But it’s worth teaching them the opposite: risk is simply the price of a possible reward, and every real reward carries some element of risk.
The trouble starts when someone offers a big return with none of the cost attached.
An investment's return depends on its level of risk, so our mini millionaires should hear the alarm bells ringing (or the saxophones getting louder) when someone promises high returns at minimal risk.
Help your mini millionaire see that "guaranteed", "huge", and "no chance of losing" turning up in the same sentence is a big, red, walking warning sign.
Takeaway: When the reward sounds big + risk sounds like zero = Red Flag.
The best defence against a bad deal is a slow one.
One of the most useful money habits one can learn is to pause.
When any offer arrives with money and urgency attached, teach your mini millionaire to stop and ask a few plain questions before saying yes.
It’s well worth anyone’s time (but especially a mini millionaire coming to grips with all things money) to learn these four questions that test any money offer…
Takeaway: Slow down when money and urgency show up together. Rushing is how people get caught.
The best way to spot a trap is to build one.
Flip the script at dinner tonight: Let your mini millionaire play the con artist and try to sell you a dodgy deal, then you spot the tricks, then swap roles.
Hand them the real playbook first. The FSCA's list of scam red flags reads like a cheat sheet: promise unrealistic returns, demand an upfront fee, keep the details vague, push people to act right now, and slide into the WhatsApp group.
And when your mini millionaire builds the trap themselves, they start to see it coming from the inside.
Takeaway: The fastest way to recognise a scam is to try building one yourself.
Knowing the red flags only counts once your mini millionaire can catch them in real life.
Our free downloadable resource, My Scam Spotter, turns this week's lesson into a game. A grown-up reads out six money offers, from a classmate's dodgy "double your money" promise to a WhatsApp forex "trader", and your mini millionaire then decides: Scam or Legit?
They tick their answer, then write down the clue that gave it away.
It builds that all-important pause-and-check habit in a fun way, before landing on a promise they can make around what they'll do when something sounds too good to be true.
Print it out, play it around the dinner table, and watch the penny drop.
