I would like to give my grandchildren what I consider more worthwhile birthday and Christmas presents. Since I regret waiting until age 60 to start learning about stocks, etc., I think I would be doing them the big favor of teaching them how money can grow by giving them stock instead of toys. However, I am thinking in terms of $50. presents. You can't get one share of CocaCola for that. Their ages are 9 and 11--I would of course give them some small toy or something along with the monetary gift because they ARE children. I would appreciate suggestions--if stock is not a good idea, what would be a good one? I gather there are tax implications nowadays re: children's bank accounts.
I would like to give my grandchildren ... stock instead of toys. However, I am thinking in terms of $50. presents.You could start a DRIP (dividend reinvestment plan) for them with one share of stock and then add to it for future gifts. It would be a bit more than the cost of one share to set it up because of fees, so the first gift may be more than $50, but then you can add to it in amounts that aren't whole shares. See the DRIP board for more info on which stocks are available for this, etc.I would appreciate suggestions--if stock is not a good idea, what would be a good one?Stock is a great idea! I gather there are tax implications nowadays re: children's bank accounts. Yes, they are liable for tax on the dividends, but unless they have a lot of money besides this, or are employed, they won't owe any tax because the amount earned is too small. They'll also need to keep track of what was paid for the stock so they can pay capital gains when they sell it.
Ho Nycek,Wonderful idea. Wife and I did the same thing with our twin grandsons now 4 yoa. DRiP investing is the way to go. Check out the Drip Investing-Basics board. At the bottome you find the FAQ for basic information. For sites to find out what requirements are for the various stocks check out www.moneypaper.com and also www.netstockdirect.com. I think you will have no problem finding good companies to set up DRiP accounts with no fees at the $50 level.Good Luck, SgtppPS. Check out the fools new book, Investing Without a Silver Spoon.
nycekThe drip mentioned in this thread sounds like a great way to go. Here is another, one that I have been considering..Note, however, that you need to check with them for the amount of lead time needed to get the certificate before gift day (birthday, xmas, etc..)http://www.oneshare.com/index.aspStony
nycek:Depending on how you feel about the company, you might want to buy each of your grandchildren, X number of shares in Disney (for example) and get the certificates themselves to give to the kids. Many companies have interesting certificates but Disney's would be a little more on their level. They then could frame (?) the certificate and hopefully ask what the whole idea of stocks and certificates, etc are all about. Seems to me to be a great opening move to get them interested.Have a great day!OldToad
Well I was almost done with a reply and my computer blinked. I have no idea what happend to the reply I was preparing. So if this is a repeat, Sorry.nycek:I think you are on the right track. I liked OldToad's idea. Any thing you can do to make the gift more tangible and meaningful to the grandkids will help make them more appreciative when they get the gift. I don't think 9 and 11 year olds will get too excited about grand pa's gift of stock. When they are older and need the money for a major purchase they will be very appreciative. But until then I would do what ever possible to build their interest. I was going to suggest that along with the stock, you give them a more tangible gift. Chuck O'Neil
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