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Started By
Message
14 Year Old Wants to Invest
Posted on 4/4/17 at 9:30 pm
Posted on 4/4/17 at 9:30 pm
Any ideas whatshe can do? She wants to put 1-3k aside a year. I don't want to be tied to her because of my tax bracket... but know she can't open an account.
To head off the question- how does she make money, we pay for grades. $250 per 9 weeks for straight A's. My theory is I will get a ROI on that from scholarships. She also babysits and such.
To head off the question- how does she make money, we pay for grades. $250 per 9 weeks for straight A's. My theory is I will get a ROI on that from scholarships. She also babysits and such.
This post was edited on 4/4/17 at 9:33 pm
7
Posted on 4/4/17 at 9:32 pm to CaptainJ47
Custodian Account.
Posted on 4/4/17 at 9:35 pm to yellowhammer2098
Not familiar with that type of account. Can I also gift my child the max every year for her to invest?
Posted on 4/4/17 at 9:40 pm to CaptainJ47
Investopedia
ETA: Not sure if this avoids your tax bracket issue but it is what was given to me as a minor. Basically got the account transferred to me once I graduated college (though I think technically it should've been mine from 18 on.. probably best I didn't have access to the money till after college).
ETA: Not sure if this avoids your tax bracket issue but it is what was given to me as a minor. Basically got the account transferred to me once I graduated college (though I think technically it should've been mine from 18 on.. probably best I didn't have access to the money till after college).
This post was edited on 4/4/17 at 9:45 pm
Posted on 4/4/17 at 10:29 pm to CaptainJ47
quote:
14 Year Old
quote:
She wants to put 1-3k aside a year.
Jesus.
I was one poor 14 year old apparently
Posted on 4/4/17 at 11:43 pm to CaptainJ47
try DRIPs-- Dividend reinvestment plans.
Posted on 4/5/17 at 12:01 am to CaptainJ47
I second the drip idea. Buy shares of companies she knows, like Apple, Disney, Coca Cola. Might give her more of an interest in how the businesses operate at a basic level when it comes to paying dividends.
Posted on 4/5/17 at 6:58 am to Boh
Good call. The good news is the kid is a saver. My 16 year old is a spender. My daughter actually beings me stuff she knows is popular at school as a way to try to investigate if a company is private or public. Pretty fascinating actually.
Thanks for the help.
Thanks for the help.
Posted on 4/5/17 at 8:41 pm to CaptainJ47
I invested $1000 when i was 12, around 1998. By 2000 I had $10,000 in investments, in 2002 I was back down to $1000. Tech stocks were hot and it was the only sector I bought, even though I was young I learned a ton about diversification and taking profits. I have been contributing bi-weekly ever since, whether it be $10 or $500.
These investments and lessons have changed my life, I hope I can get my kids interested the same way.
These investments and lessons have changed my life, I hope I can get my kids interested the same way.
Posted on 4/6/17 at 10:21 am to CaptainJ47
One piece of advice, don't let them open up a retirement account. Mrs. Mule thought she was really smart when she was 18 so she opened a Roth with $3000 that she got from her graduation. I discovered it when we got married. The fees have basically eating up any gains and she now makes too much to invest in a roth.
Posted on 4/6/17 at 10:46 am to mule74
quote:
One piece of advice, don't let them open up a retirement account. Mrs. Mule thought she was really smart when she was 18 so she opened a Roth with $3000 that she got from her graduation. I discovered it when we got married. The fees have basically eating up any gains and she now makes too much to invest in a roth.
What? Then you need to change whoever it is with. Get a Vanguard, Schwab, etc. and the fees are incredibly low. Your Roth account has nothing to do with "making too much to invest", that is 100% dependent on your year to year income.
Posted on 4/6/17 at 6:57 pm to baldona
Correct our year to year AGI is too much to do a Roth.
This post was edited on 4/6/17 at 6:58 pm
Posted on 4/7/17 at 8:50 am to mule74
My dad bought me a couple shares of stocks when I was 12 in Mcdonalds because I loved their chicken nuggets. Still have those shares 25 years later
Posted on 4/9/17 at 8:30 am to CaptainJ47
I have UTMA accounts set up for my kids. The only disadvantage is that it counts towards an asset of the child when applying for financial aid for college.
They are allowed a certain amount of tax free unearned income through the account ($1050 in 2017 I believe) that can lower your tax burden. The next $1050 is taxed at the kids rate, and then any gains over that are taxed at the parent's rate. I'd suggest reading all the rules prior to starting one, but it seemed to be a pretty good deal for my situation.
ETA: It was really easy to setup using Vanguard, btw.
They are allowed a certain amount of tax free unearned income through the account ($1050 in 2017 I believe) that can lower your tax burden. The next $1050 is taxed at the kids rate, and then any gains over that are taxed at the parent's rate. I'd suggest reading all the rules prior to starting one, but it seemed to be a pretty good deal for my situation.
ETA: It was really easy to setup using Vanguard, btw.
This post was edited on 4/9/17 at 8:30 am
Posted on 4/10/17 at 12:08 pm to MsState of mind
quote:
My dad bought me a couple shares of stocks when I was 12 in Mcdonalds because I loved their chicken nuggets. Still have those shares 25 years later
Still love their chicken nuggets?
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