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As parents, our deepest desire is to ensure that our children are set up for success in life. We invest in their education, extracurricular activities, and personal development, but one of the most impactful investments we can make is often overlooked—their financial future. Establishing a savings or investment account, such as a “child and godparent” account, is more than just putting money aside; it’s about teaching your child the importance of financial literacy, empowering them to make sound financial decisions, and providing them with a strong financial foundation that can grow exponentially over time.
In this blog, we’ll explore the immense benefits of starting an investment plan early for your child. We’ll demonstrate the power of compound interest, show how a small, consistent investment can grow significantly over time, and discuss how this plan can shape your child’s future financial behavior. We’ll also delve into the importance of financial literacy and how arvy, with its community-driven approach, supports families on this journey.
The Power of Compound Interest, Age 0-20
Compound interest is often described as one of the most powerful forces in finance, and for good reason. It’s the process by which the returns on an investment generate their own returns, leading to exponential growth over time. The earlier you start investing, the more time your money has to grow, and for a child, whose investment horizon could span decades, the benefits are particularly compelling.
Chart 1: Who will earn more?

Source: Federal Reserve Bank, St. Louis
Consider starting an investment plan when your child is born. By contributing CHF 100 per month into an investment account with an average annual return of 7%, you can create a powerful financial engine. Over 20 years, your contributions would total CHF 24,000, but thanks to compound interest, the account could grow to approximately CHF 52,000. This isn’t just money—it’s opportunity.
Chart 2: Savings plan (dollar-cost-averaging) of CHF 100 per month, Age 0-20, 7% return

Source: arvy, investment calculator
At age 20, your child could use this money for a variety of life-enhancing opportunities: funding their education, starting a business, traveling the world, or obtaining a driving license. The financial cushion provided by this account gives them the freedom to pursue their passions without being overly burdened by financial constraints.
The Long-Term Horizon: From Age 20 to 60
But the story doesn’t end at age 20. Suppose your child decides to continue the investment plan on their own. If they increase the monthly contribution to CHF 250 and maintain this for the next 10 years, their account could grow significantly. By the time they turn 30, with consistent contributions and the same 7% annual return, the account could be worth approximately CHF 148,000.
Chart 3: Continuation of savings plan (dollar-cost-averaging) of CHF 250 per month, Age 20-30, 7% return

Source: arvy
The real magic of compound interest is revealed when your child continues investing from age 30 to 60. By increasing their contributions to CHF 500 per month for the next 30 years, the account could grow to an astounding CHF 1.7 million by the time they reach 60. This is the transformative power of a long-term investment horizon combined with the discipline of dollar cost averaging (DCA), where fixed amounts are invested regularly, regardless of market conditions.
Chart 4: Continuation of savings plan (dollar-cost-averaging) of CHF 500 per month, Age 30-60, 7% return

Source: arvy
Dollar cost averaging not only makes investing accessible but also reduces the risk of trying to time the market. It’s a strategy that promotes consistency and patience, attributes that are crucial for successful long-term investing.
Financial Literacy: The Key to Lifelong Success
Investing isn’t just about growing money; it’s also about growing knowledge. Establishing an investment account for your child provides an excellent opportunity to teach them the fundamentals of financial literacy. This is where arvy comes in. You might have seen our arvy’s Weekly 😉. Join 5k+ readers here.
At arvy, we believe in the power of community and education. Our investment platform not only helps parents invest for their children’s future but also engages children in the process. With a “read-only” login, your child can monitor their account, receive notifications, and start learning the basics of investing. This hands-on experience is invaluable, teaching them how global markets work, the importance of long-term planning, and the impact of their financial decisions.
Financial literacy is a critical life skill that too many people lack. At arvy, we have seen firsthand how this knowledge gap affects the “boomer” generation. Many of them, now reaching retirement, are realizing that they lack the confidence and understanding to manage their finances effectively. They sit on substantial amounts of money, but inflation and the loss of purchasing power are slowly eroding their wealth. Had they been taught about investing from a young age – just as you can do now with your child’s account – they would have entered retirement with not just more money but more knowledge and confidence. They would be better equipped to handle the complexities of managing large sums and making informed investment decisions.
The Role of arvy: Your Partner in Financial Education
At arvy, we are committed to being more than just an investment platform; we are your partners in financial education and the journey of investing. We understand the challenges of navigating the investment world, and we’re here to guide you and your family every step of the way. Through our community-driven approach, we offer resources, tools, and support to help you and your child make informed decisions.
Our platform is designed to be user-friendly, with features that make it easy for both parents and children to engage with their investments. We host regular webinars and community events focused on financial literacy, where families can learn together. Whether it’s understanding market trends, learning about different investment strategies, or simply staying informed about your portfolio, arvy is here to ensure that you and your child are equipped with the knowledge you need.
How We Make Investing Simple & Understandable

arvy’s takeaway
Setting up a child and godparent account is one of the most impactful financial decisions you can make for your child. By starting early and harnessing the power of compound interest, you can help them build a strong financial foundation that will serve them for life. But beyond the numbers, this account is a tool for education – a way to teach your child about the value of money, the importance of investing, and the power of financial literacy
At arvy, we are passionate about helping families achieve financial security and independence. We believe that everyone should have the knowledge and tools to make informed financial decisions, and we are committed to supporting you on this journey. By investing in your child’s future today, you are not only giving them the gift of financial freedom but also equipping them with the skills they need to navigate the complexities of the financial world with confidence. Together, we can ensure that the next generation is better prepared, more knowledgeable, and financially empowered.
And all this with a small starting amount of CHF 100 per month.
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