Best investment account for a 10-year-old?

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  • #94110 Reply

      What would you do?

      My son (10yo) is interested in investing. He’s read a couple of age appropriate books and has some basic knowledge of the stock market. We would like to open an account for him.

      My question is what account would you open. Looking at around 25$ a month to start.

      I do own a business and have toyed around with the idea of having him clean my office and shred documents for me. This would allow me/him to open a Roth IRA due to his earned income.

      Interested to hear ideas.

      #94111 Reply

        Roth all the way and I would make it a project tell him to pitch you the stocks he wants to buy it will let him do research on the stocks give him a few to think about some good and bad and let him find some in his own but also introduce him to S&p index and total market index funds.

        #94112 Reply

          Yes, hire your son and get a Roth account open for him.

          I’d have him doing a percentage of companies he’s researched to maybe invest in and then doing the majority in a ETF that follows a major index with low mngt costs and low turnover ratios.

          Suggested: Is there a savings or non-retirement investment account that an 18-yr-old or parents can utilize which will not be considered in determining financial aid awards for college?

          #94113 Reply

            Fidelity has great accounts for kids under 18. My sons set up Roths for their earned income and brokerage accounts for regular investing. The book A Simple Path to Wealth by J. L. Collins is easy to understand.

            #94114 Reply

              Fidelity caters to very small investors like that.

              #94115 Reply

                Fidelity. Let him buy stock in something he is interested in so it becomes personal.

                #94116 Reply

                  You could go with Fidelity, Vanguard or Schwab. I use Schwab. I like their website, app and love their customer service. I setup a custodial brokerage for both of my girls am starting to move money from custodial to IRA for my 15 yr old as she now has earned income.

                  Call each company’s customer service and see what they recommend and if you like the. Schwab customer service helped me learn a lot about how to trade, types of accounts, etc.

                  I have 401k with Fidelity so some of the website and apps are going to be very similar. I’ve heard Vanguards is not the best. Also, if you have $25 per month you could buy mutual funds or buy into shares that are more expensive using fractional shares (Schwab Slices. I think the others have it too).

                  So, with $25 you could buy $5 apple, $5 Tesla, $5 Microsoft, $5 Nvidia, $5 Amazon or whatever mix you want. Not all stocks are available but most are.

                  Best of Luck! Ask away with any other questions.

                  Don’t miss: My children 10,6,6 all have savings accounts. What investment accounts should I start for them?

                  #94117 Reply

                    If he’s eligible to open a Roth IRA – he should open that. With Fidelity.

                    #94118 Reply

                      Definitely the Roth. 10 years old? Imagine the tax-free growth! Stop toying with the idea and get it going. He will thank you for this later in life.

                      Teach him about index funds but if he wants individual stocks let him try that out too.

                      Making mistakes and seeing what happens at his age will be beneficial and hopefully set him up as a smarter investor when he starts making a full time pay check.

                      #94119 Reply

                        My son’s UTMA is with Schwab. I already had an account with them and it uses the same login. Vanguard, who I also have an account with, has a minimum starting amount for VTSAX while SWTSX, that tracks very similar indices, doesn’t (technically, it’s $1, but you get the point).

                        Schwab also allows fractional purchases for some individual stocks.

                        #94120 Reply

                          I felt like M1 and there pies were easy for my kids to understand. They got excited about there pies and they could see the fractions. Which is something they are learning about in school.

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