Saving money is a great habit but if parents want their children to learn how to truly build wealth they should teach them about investing.
That's the view of University of Waikato professor of economics and head of the school of accounting, finance and economics, Dr Frank Scrimgeour, and lecturer in finance Dr Abhishek Mukherjee.
The reaction comes as Bay investment experts say more parents were opening accounts for their children to give them a head start in reaching financial freedom at retirement age.
Thanks to the magic of compound growth, a deposit of $2040 when a child is born could become a potential nest egg of $1 million by the time they turn 65 - if the US sharemarket continues to grow at 10 per cent each year.
Mukherjee said a person had to be 18 years old to invest in the stock market and custodial accounts were a gateway to investing.
"Parents can give their children things like free stocks and bonds or real estate without significant tax consequences with a custodial account."
Mukherjee said teenagers who were responsible for paying unexpected expenses themselves, rather than asking their parents for money, were more likely to keep track of their money.
"Teenagers who earn their own money can better understand financial concepts like saving and spending.
"As long as it does not interfere with school, working a part-time job can be a great educational experience."
Hundreds of students were learning about money management and investing in shares, bonds and commodity markets at the university's Tauranga campus.
Scrimgeour said there were about 250 students enrolled in individual accounting papers and 130 in individual finance papers at the university's Tauranga campus.
As well as learning about investments and financial markets, many students were interested in corporate finance, he said.
"We expect Tauranga enrolments to grow given the employment opportunities associated with high-quality graduates in accounting and finance."
Students completed practical assessments that aim to develop their investment decision-making skills, Scrimgeour said.
"Students get to work on a fund simulation project using our brand-new finance trading software.
"This hi-tech simulation project provides the student with the experience of buying and selling shares, bonds, commodities and compete to build the most valuable portfolios.
"In the accounting papers, we teach the student to work with clients to help them make their businesses more profitable and successful and reduce their exposure to financial risk."
Toi Ohomai Institute of Technology accounting tutor Josef Langreiter said more than 100 students were enrolled in accounting papers across its Rotorua and Tauranga campuses.
"With the advancements in technology, accounting cloud-based systems and the expanding role of what an accountant does the profession has become more dynamic and appealing to students."
Toi Ohomai offered three accounting courses, The Bachelor of Applied Management (Accounting), New Zealand Diploma in Business (Accounting Strand) and the New Zealand Certificate in Business (Accounting Support Services).
Accounting was also incorporated into several business courses. Students learn the fundamentals and concepts of accounting, financial accounting, management accounting, audit, taxation and finance.
"Our students are noticeably more involved in share market investments due to platforms like Sharesies and Hatch. They are developing experience around risk and return without having to risk much."
Langreiter said there was nothing new about compound growth and it was important to bear in mind that $1m in 65 years will not have the buying power of today.
"If inflation averages 2 per cent over the next 65 years it would have the buying power of $300,000.
"Ideally we should both save and invest..."
Personal finance lead at Sorted, Tom Hartmann, said they offered Sorted in Schools, which was a free financial capability programme aligned to the national curriculum, for Year 9 to 13 students.
Hartmann said many parents want to do as much as they can to give their children a head start.
"The question is what is the best thing they can do. Putting money into managed funds is good but it depends on the end goal."
Papamoa Beach mum Kim Fifield opened a Hatch Kids Account on behalf of her 15-year-old son Jack in the first week of March.
Fifield said her son has Fetal Valproate Syndrome (FVS), autism, Global Developmental Delay, ADHD and epilepsy, and she hoped by opening an account for him would teach him to make better decisions about money and achieve financial security.
"Jack is an awesome 15 years old... Given his issues and cognitive abilities, it is incredibly important to me to try to ensure his finances are in order for his future," she said.
"I hope that through investing in shares, Jack sees how his money can grow if he chooses to invest it rather than spending it on frivolous things.
"If at periods he is able to withdraw a portion to buy assets for himself, it would lead him to understand the rewards of investing in shares."
Fifield said while she understood there were fluctuations in the market, which can be higher risk, Jack's returns were currently in excess of $2500 in less than four months - an 11 per cent growth.
"In four months a bank account will have only earned him about $30 (0.4 per cent) from interest.
"As a parent, I'd prefer to see his money working for him long term in a portfolio than a bank account whose results are less than inspiring in encouraging saving."
Although Fifield said she was still learning about the stock market she was trying to be "fairly diverse" in her investment approach rather than putting all her eggs in one basket.
"I am planning on a similar approach with Jack's portfolio," she said.
"I do want to put choices forward to Jack about what he would like to invest in going forward and I can foresee fairly plentiful and interesting conversations with him about investing in the future."