I’m always looking for unique ways to help people understand the complex concepts of financial literacy, especially for young minds. So, when I had the opportunity to speak to my daughter’s class, I thought, why not make learning about finance fun and tangible? What better way to do this than by using an analogy that every kid loves: candy!

Creating a Candy Stock Portfolio

We began with a simple activity to teach the students the fundamental concepts of money, value, and trade. I let each student choose five pieces of candy from a large variety of treats. I explained that they could choose any candy they liked, but the catch was that the price of the candy wasn’t fixed- throughout the day, the prices would fluctuate. And, in a twist, they could also trade candy with one another, just like in the real world of stocks and investments.

Once everyone had their candy, I wrote down the prices of each type on the board. This is where things got interesting. The prices weren’t static- much like in the stock market, the values of the candies would change due to different events that occurred throughout the day. Some pieces of candy were tied to a “manufacturer” (or in our case, a fictional candy company) that had a sudden shortage of sugar, while others surged in popularity because one type of candy had gone viral on TikTok.

Candy Stock Market Opening Bell – Let the Trading Begin!

The class quickly understood the principles of Supply and Demand as they observed how the prices shifted throughout the day. Students excitedly traded candies with their friends, negotiating prices, buying and selling in a makeshift candy stock market.

When the candy stock market closed, I called everyone back to their seats. It was time to calculate the new value of their candy portfolio. Based on the price changes from the morning’s events, each student added up the new worth of their candy. Some had made savvy trades and saw their portfolios grow, while others were caught off guard by the rapid changes in candy values.

Through this exercise, the kids experienced firsthand how the market works- how values can go up and down based on external factors, and how the choices they made impacted their financial standing. They also learned the importance of being informed and being flexible in response to market changes.

Candy Risk Management

To take the lesson even further, I introduced a concept that’s key to both wealth management and life in general: insurance. I gave the students the opportunity to purchase insurance on their entire portfolio of candy for the small price of their single most valuable candy. With the purchase of this candy insurance, their portfolio would be protected. However, if they didn’t buy the insurance, they could face total candy loss!

We then drew names from a hat, and six students were randomly selected to experience a catastrophe: their entire candy portfolios were wiped out. Those who had purchased insurance were unaffected. Their candies were returned, and their portfolios remained intact. Meanwhile, the children who had waived the insurance lost everything.

This was a clear demonstration of risk management– the idea that life can be unpredictable, and sometimes it’s worth taking steps to protect what you value most. The children learned that while some risks are worth taking, others (like the risk of losing their candy) are worth insuring against.

They Actually Got it!

At the end of the day, the kids had a blast and learned some valuable lessons. They grasped basic financial concepts such as supply and demand, the stock market, and the importance of insurance and risk management. What I loved most about this exercise was how hands-on and engaging it was. It turned abstract ideas into something tangible and fun, and it sparked conversations about money, value, and decision-making.

As an advisor, I believe that teaching financial literacy early on can have a profound impact on how children approach money management as they grow older. Money is an important part of life, and learning how to manage it wisely can set a strong foundation for a secure financial future. So why not make it fun while you’re at it?

Happy teaching and trading!

*The opinions voiced in this material is for general information only and is not intended to provide specific advice or recommendations for any individual. Guarantees are based on the claims paying ability of the issuing company.