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06-10-2020, 08:14 PM
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#21
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2010
Location: Sarasota, FL & Vermont
Posts: 36,370
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I think to begin with individual stocks like McDonalds or Disney is fine to teach the lesson that by buying stocks you are investing in businesses. Then the second lesson is to diversify your holdings by owning many different stocks and an easy way to do that is through indexing.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
Retired Jan 2012 at age 56
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06-26-2020, 06:24 AM
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#22
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Thinks s/he gets paid by the post
Join Date: Feb 2019
Location: St Pete
Posts: 1,242
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Going to do Stockpile! My sister finally got back to me and thinks it's a great idea. I agree, individual stocks are not ideal for "investing" but are great to get them engaged and excited as they can own something they can relate to while learning about investing.... We can move on to more diversified accounts (and/or valuing equities) later when there is "real" money at stake (depending on my situation at the time, I'll likely match any Roth contribution at some ratio when they are teens).
Who knows, maybe one of them will FIRE at 20 if they pick the right thing. They can't go broke cause it's my money. I told my sister I need to teach them to be financially responsible so they'll be able to care for me when I'm a lonely old man since I have no kids.... Who needs a rich uncle when you can have wealthy nephews and nieces!
FLSunFIRE
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06-26-2020, 10:36 AM
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#23
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2005
Location: Northern IL
Posts: 26,891
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Quote:
Originally Posted by FLSUnFIRE
... Who knows, maybe one of them will FIRE at 20 if they pick the right thing. They can't go broke cause it's my money. ...
FLSunFIRE
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I actually think this is the wrong way to go about it. Teaching them they can't lose? That's not real life, and not a good lesson at all, it's backwards, IMO.
Quote:
Originally Posted by FLSUnFIRE
... I agree, individual stocks are not ideal for "investing" but are great to get them engaged and excited as they can own something they can relate to while learning about investing....
FLSunFIRE
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Quote:
Originally Posted by pb4uski
I think to begin with individual stocks like McDonalds or Disney is fine to teach the lesson that by buying stocks you are investing in businesses. Then the second lesson is to diversify your holdings by owning many different stocks and an easy way to do that is through indexing.
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I wonder about that. How many times can you pass a McD's and say "you own a part of that"? Is it that exciting? Wouldn't it get old fast?
I dunno, but it might be be more exciting (and we are using the term "exciting" pretty loosly here ) to point out just about every business you go by, and say "you own a piece of that, and that, and that!" You could even make a game of it, and keep the pages of the prospectus of VTI with the alphabetical list of stocks, and try to find them on the list as you drive by.
Like the T-shirt the kids bought me, with a line of a dozen different beer taps on it "Diversity is good!". Just my opinion.
-ERD50
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06-26-2020, 10:56 AM
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#24
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Thinks s/he gets paid by the post
Join Date: Feb 2019
Location: St Pete
Posts: 1,242
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Quote:
Originally Posted by ERD50
I actually think this is the wrong way to go about it. Teaching them they can't lose? That's not real life, and not a good lesson at all, it's backwards, IMO.
I wonder about that. How many times can you pass a McD's and say "you own a part of that"? Is it that exciting? Wouldn't it get old fast?
I dunno, but it might be be more exciting (and we are using the term "exciting" pretty loosly here ) to point out just about every business you go by, and say "you own a piece of that, and that, and that!" You could even make a game of it, and keep the pages of the prospectus of VTI with the alphabetical list of stocks, and try to find them on the list as you drive by.
Like the T-shirt the kids bought me, with a line of a dozen different beer taps on it "Diversity is good!". Just my opinion.
-ERD50
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They very well can lose.. they are starting with my money but it is theirs upon receipt. We are talking $50-100/birthday... this isn't high stakes. Going through the process of picking a company and buying it is a lot more fun and educational as they may research who makes whatever they are into that they want to buy. Even if they pick horrible "investments" they are still likely be worth more years from now than a crappy beat up toy or sweater from "weird uncle FLSunFIRE!"
I only hold two individual stocks and I absolutely get a kick out of owning them (also have a couple very out of the money limit orders that will likely never execute for TSLA and AMZN just to own them for fun even though I cannot justify the valuations even at my heavily discounted bid). I only sold off the individual stocks I accumulated when I was young (started DRIPing in my early 20s) because I needed to raise cash for my divorce and they were insignificant to my NW and divesting of them simplified my record keeping and taxes.
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06-27-2020, 02:44 PM
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#25
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Feb 2004
Location: Portland, Oregon
Posts: 7,113
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I haven't tried it but Fidelity will let you buy a slice of a share. Pick out a couple of companies that the kids can watch. NIKE has been hit because the retailers they sell to are having difficulties but their own stores and online have been strong. Does the family shop at Costco? How about Disney, Apple, Starbucks, Amazon? Make a list and let them choose. Prepare them for the reality that prices go down as well as up. Depending on their age and interest share with them that the pandemic is depressing sales/profits for many companies.
__________________
Duck bjorn.
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06-27-2020, 03:45 PM
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#26
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2008
Location: On a hill in the Pine Barrens
Posts: 9,720
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I'd go with Schwab stock slice concept, where you can pick up to ten companies, and invest a minimum $50.
If I were doing this, I might pick Disney, Netflix, Tesla, Apple, Microsoft, Amazon, etc. Put in $50 a month for 12 months, then sit back and watch with the youngsters.
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