So I recently open up a student saving account for my son who is 11years old, I asked my son what he like to save up to and he told me he wants to buy stock in SONY. He recently read the book "Rich Dad poor Dad for teens" I think its a good idea and Im glad that he is interested in this. But my only problem is I dont know too much about stock, how to buy it or how to go about it. Do any of you moms have any suggestions for me on how do I go about this??
Thanks A Bunch !!
That's great! I was home schooled growing up and my parents did this with us! When I was older I wanted to buy stock in apple... wish I had!
My husband is somewhat into stocks. I asked him about it, and his advice is that while your son is saving up, there are websites that allow for people to have "fantasy portfolios" (investopedia.com, for example, but there are others). They start you out with 100k, and you can create a profile, buy and sell stocks, track gains and losses, and watch and monitor your portfolio. It's a great way to learn about stocks and trading. Good luck!
Google "stock market simulation." You'll find a lot of simulations to help both you and your son learn about the stock market without risking anything right away.
They give you play money to invest and you can move it around as you see fit. Most of these also offer a lot of education about the stock market.
I think this is an awesome idea, and one that you should definitely help him out with. My husband read that book, and loved it too. Anyway, do you and your husband buy stocks, mutual funds, etc? If so, maybe you can call the person who helps you, and he can help your son. If not, maybe you could check with Charles Schwab, I don't think there fees are too steep, like Edward Jones. We use both, but I know it costs less for Charles Schwab. Good luck. Your son is in line to become a very financially stable man in the future.
I would suggest you and your son to go speak with a financial advisor. I'd bet they would be more than thrilled to speak to a young mind! Good for him! He sounds super motivated and smart!
You can do "all of the above" online through Ameritrade or E-trade with basically NO fees, especially compared to the "traditional" stockbroker route.
It is super easy, and you can call them 24/7 and speak to a broker who can explain everything you need to know and even walk you through whatever choices you make.
The neat thing is, your portfolio is available to you 24/7 as well, and you can add, subtract, transfer, etc. etc. etc. any time you wish.
I have all of my dividend paying stocks using the DRIP method and have increased my shares without having to send more $$ to any of them...I think it is a great method, especially for a young man just starting out. (Or for us older folk who don't have a lot of $$ to add to our portfolios now!)
Trust me, I'll be 70 next month, and if I can do it, anyone can do it! Best of luck to your young entrepreneur!
Go to your bank, or a Financial Advisor and ask them.
There are many ways to do this and buy stock.
Being he is a minor, you have to be the parental sign off on it and be the "Custodian" for his account, and thus you will be responsible for any taxes on it etc.
Ask about transaction fees.
Ask about what is the minimum amount, you need to open an account/buy that stock.
Banks, have "Investment Consultants." And they will tell you all the info you need. I did that with my kids who are 5 and 9 years old.
So that they can learn about it, too.
The guy at our bank, was more than patient and good, at explaining things to us. Spending over 1 hour with us. AND there was no expectation that we had to put money down, right then. I told the Bank guy, we just wanted to talk to him... so my kids learn.
I would also, buy the book "Stock Investing For Dummies" book. This book series is good. And explains well. Good for him and you to read this.
I second the DRIP approach. You have to be very careful because management fees could eat up not only your appreciation and/or dividends but your original investment. This happened to a stock gift I made to my niece before I was more know more knowleadgable about how stocks worked.
Some great advice from the other moms. I, too, would suggest seeing an investment counselor; check out E-Trade, Charles Schwab, or Fidelity. At his age, or for 1st time investors, I'd go more with mutual funds or index funds over individual stocks. I know several of the mutual fund companies have funds aimed more at youthful investors and include stocks of interest to kids, such as McDonalds, Mattel, Nintendo, etc. An advantage with index funds is that they have low fees.
I agree. Feed that mind of his. I would focus on teaching him about mutual funds instead of stocks which are riskier. Dave Ramsey has some great programs that are for teens. It teaches budgeting as well as investing. You should be very proud of him, he'll go far....
In High School and College we would "pretend" to buy stock and follow it. See if he would like to do that too. I think a Financial Advisor at Wachovia, or Charles Schwabb would be great. If it's a relatively small amount and he knows it could go down instead of up, I say go for it as a learning experience. Good that he is reading Rich Dad Poor Dad for teens. If memory serves it is fairly conservative so he won't be investing in penny stocks next if he follows the influence of the book.
It's easy to start out small and research on the Net about how to watch these things. If he wants to do more and you are leary on spending money, you can also have him buy penny stocks.
I suggest he do it through a DRIP (dividend reinvenstment plan). Charles B Carlson wrote a book about DRIP investing. Here is a link to his website http://www.dripinvestor.com/index.asp
Some companies will let you buy directly from them. His book details all of this. I also found this website that details Sony's DRIP plan.
http://www.dripadvice.com/sony_sne_drip.html
Etrade makes it really easy. That's fantastic, what a great kid!
