Teaching young adults about money (and investing money) may well be one of the most important gifts they will ever receive. These are lessons that will stay with them for the rest of their lives, helping secure their financial futures. Teaching about investing develops important skills that will benefit him or her throughout their life.

Here's how to get started.

Start From Square One. Long before getting into margin calls and P/E ratios, help them understand the fundamentals, such as explaining that saving is for short-term goals and investing is a strategy that will help them meet longer-term goals.

Risk Versus Reward. They need to know that investments that offer higher returns often come with higher risks, and investments with lower risks may deliver lower returns.

Diversity Rules. Diversification is an important concept for any aspiring investor. While stocks may be more attractive to them, there may be a place in their portfolio for other investment options. Examples include bonds, which are funds that an investor lends to a company as an interest-bearing loan, and mutual funds that bring together money from many people and invest it in stocks, bonds or other assets.

Practice, Practice and More Practice. Help your young adult experiment before actually putting real money on the line. Have your son or daughter choose several stocks and follow their performance (they enjoy investing in companies that they are familiar with, such as a clothing, computer, or soft drink manufacturer).

Follow The Tracks. Teach them how to track the company's stock price in the newspaper's financial listings or online. Be on the alert for articles on companies your young adult is familiar with, and talk about how news can impact stock performance.

Make It Fun. There are hordes of fun and engaging stock investing games on the Internet. Here is one: Virtual Stock Exchange.

Real World Investing. Eventually your young adult may want to move on to "real investing". But until he or she is age 18 - 21 (depending on your state), they can only open a custodial account, which is controlled by an adult for a minor.

When you have more time, here are some other great resources:

The Teenage Investor : How to Start Early, Invest Often & Build Wealth
The Young Entrepreneur's Edge: Using Your Ambition, Independence, and Youth to Launch a Successful Business