Since 2010, we have been suggesting some stock ideas for parents and grandparents to purchase on behalf of younger generations.
It all started when my son came home from school with some amazing pictures of a Sikorsky helicopter. He was very impressed! His math teacher’s husband at the time was an engineer at Sikorsky and visited Noah’s class to talk about his job. Noah thought it would be really cool to have a helicopter.
As I started to roll my eyes, I quickly realized that we could make the most of this event. I suggested to Noah that we may not be able to get a helicopter, but we should buy some stock in the company that makes the helicopter, United Technologies (this company was acquired by Raytheon, RTX).
In our article below we offer more on CAIM’s stock selections for gift giving.
‘Tis the season to begin thinking about what to get our kids for Christmas. And of all the gifts we normally give, how many actually have a permanent lifespan? Wouldn’t it be nice to be able to give our children, or our grandchildren, nieces and nephews something with a meaningful and permanent impact?
There are a couple of immediate, compelling reasons to consider this idea. Stocks as gifts for kids/young adults help to:
• Promote financial literacy.
• Establish future savings.
Why is promoting financial literacy important? Because one of the best gifts we can give the young people in our lives is the gift of financial independence–and it’s always best to start early as it sets a precedent. The key is repetition. Introducing kids to companies they can relate to and talk about throughout the year consistently reinforces the idea that they have a vested interest in that company.
Buying stocks for children is also a great opportunity to teach them about money on a practical level, sitting down with them at the end of the year and going over their own portfolio and noting the changes. They might not get it at first but as you repeat the scenario for 5, 7 or 10 years they will begin to understand.
At CAIM we believe there are 3 key elements to selecting stocks as investment gifts.
1. Choose a company that has products or growth themes your child can relate to. For example, Proctor & Gamble (PG) sells lots of everyday household items from toothpaste to batteries. And Artificial Intelligence is a theme the younger generation understands better than ours!