Give Kids Stocks Instead of Toys

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Kids have too much stuff, says any parent who has waited for a child to scurry off to school so she could ninja-sneak all the lonely, untouched toys out of her just-Kondo’d space and into the local donation bin.Some have declared NO MORE, and I stand with them. Friends online gave me some great non-toy gift options for birthdays and holidays—museum memberships, baseball game outings, donations to cool nonprofits in the child’s name—but one idea that really fascinated me was stocks.Stocks are something I would have never, ever considered—when I read the suggestion, I actually thought someone had misspelled “socks.” But there are some companies that are making the process of giving stocks simple enough for the financial un-savvy, turning it into an ongoing learning activity. The hope is that kids will gain a sense of ownership over their financial future.

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In general, we want our kids to be better people than we are. We insist they eat their vegetables…Read moreOnline brokerage firm Stockpile lets you buy a gift card, pick a stock—preferably something the kid can get excited about such as Disney, Mattel or GameStop—and give it to the young recipient, who pays nothing to hold the investment. These are fractions of shares—say $25, $50 or $100 worth of stock, based on your budget.The child can go online any time to see how the stock is performing, learning why its value may be going up or down. (If you hear screams of “No! No! NO!” and a little head banging against the keyboard, it’s possible that the market has crashed.) With a parent’s approval, your emerging investor can trade shares.If a kid is really into it, parents might want to use an app called BusyKidfor $12 a year. When the child completes tasks on the chore list, he can opt to use his allowance to invest in stock.It’s an opportunity for the whole family to learn about investment and money management, essential life skills.