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5 ways to teach your kid to think like an entrepreneur

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Whether it's a lemonade stand, mowing lawns or even — these days — developing a new app, there are plenty of ways kids can become entrepreneurs.

They don't even necessarily have to be a big success. Just developing an entrepreneurial mindset can help them form necessary life skills, as well as teach them important financial lessons.

"There are these unbelievable opportunities, as parents, that happen right under your roof to teach kids about money and entrepreneurship is on the top of the list," said Thomas Henske, a certified financial planner with New York-based Lenox Advisors.

By becoming an entrepreneur, kids can learn about budgeting, saving, spending and investing.

"It makes you value money more," said Henske, who developed and runs his firm's smart-money kids program. "It's hard to make it. It's hard to keep it."

Kids are just a sponge. When you expose them to things like brainstorming and prototyping, they get it. They are almost naturals at it.
Don Bossi
President, FIRST

It also helps children develop perseverance by learning from their failures, and it begins to introduce critical thinking, said Don Bossi, president of FIRST, a nonprofit organization that helps foster innovations by students in grades K-12 in the fields of science, technology, engineering and math (STEM).

"Failure is part of the learning process," he said.

"If they try something and it doesn't work, instead of putting it down and walking away, nurture them," he said.

You can ask, "'What did you learn from that? What can you do to make it better?'"

Here are other things you can do to encourage your kid become a self-starter — and help them get smart about money in the process.

1. Foster creativity

The good news is that young kids already think creatively.

"Something about growing up sort of beats the creativity out of us," Bossi said.

"Young kids aren't as constrained by history or what they know," he added. "They are not afraid of being wrong.

"They are not afraid of being told their idea is crazy," Bossi said. "They are not afraid of failure."

Take these money steps now before your baby arrives
Take these money steps now before your baby arrives

Henske agrees, pointing out that adults tend to group-think.

So, if your kid has a great idea, be curious about it and help nurture it. Even if it is a "whacky" one, he said.

"The second you start stifling it … they lose their confidence," he said.

2. Brainstorm

Does your kid want to find a way to start making money?

The first thing to do is ask them what they can do to make it happen. That's where brainstorming comes in.

"Some kids will say, 'I can rake the leaves,' or 'I can make the beds,'" Henske said. "You say, 'Wow, could you build a business around that?'"

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Henske said he likes to encourage brainstorming by using mind maps. It can be as simple as picking up a pen and paper or using an online tool, such as

For example, his 15-year-old son came to him for money because he couldn't get a job until he turned 16. Henske turned it around and asked him to come up with an idea to earn it on his own. His son is now developing an app and website that connects teens to neighbors who need chores done around the house.

"There are cool opportunities for parents," he said. "All you have to do is be aware and be on the lookout for it."

3. Find a mentor

Kids don't always like to take advice from their parents.

"If your name is Mom or Dad, that pretty much means that you don't know anything until that child turns 30," quipped Henske.

That's why it's important to have your child find mentors who can help guide them. It can be a local businessman, a family friend or an expert in the given field.

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To help explain his or her idea, your kid can even build a prototype to show to local experts, FIRST's Bossi suggested.

That could lead to success down the road. "Think 'Shark Tank' but at a local level," he said.

4. Research the market

If you think your kid's idea has the potential to be a business, first research the market to see what the need is and assess the competition. Come up with a business model and, if it is a product, figure out how much it would cost to produce it.

"If all those things look good … your kid could start to talk to angel investors to see if someone can fund it, taking it from prototype and concept to production and maybe a real business," said Bossi.

5. Teach life lessons along the way

As you guide your children through building and running their business, talk to them about profits and taxes, Henske said.

You can also have them read books about famous entrepreneurs.

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But don't overdo it.

"Don't get caught up, as a parent, trying to use the fire-hose method: You bring the kids in the room one day and sit in the room for five hours and teach them how to be entrepreneurs," warned Henske.

Instead, think about doing it a bit at a time.

"Let it drip a little, let it sit and then talk about it," he said. "And see what they come up with.

"Or even let it sit a couple of weeks," he added.

The bottom line

If you take the time to teach and guide your kids, they'll soak it all up.

"Kids are just a sponge," Bossi said. "When you expose them to things like brainstorming and prototyping, they get it.

"They are almost naturals at it."

There may also be a price to pay if you don't, warned Henske.

"If we don't teach our kids to be entrepreneurs, which really means having an idea and taking control of your own destiny, they are going to grip onto their first job and when it changes and goes away, they are not going to be able to deal," he said.

"As a parent, that should scare the heck out of us."


CHECK OUT: 8 winter side hustles that can help you earn extra cash via Grow with Acorns+CNBC.

Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.