At last, they now want to invest some of their summer dough, but where do you go to get them started? Regardless of whether they are 13 or 17, they can start an investment account with any bank, brokerage firm, or mutual fund company. Companies such as Fidelity, Charles Schwab, E*Trade, Merrill Lynch, or TD AMERITRADE are examples of places they can go to establish an investment account in order to invest in stocks or mutual funds. If they are not of legal age, you must set up a custodial account with them. Once your teen is of legal age (at 18 or 21, depending on the state you live in), the account can be fully in his or her name. Parents will need to decide whether their teen is mature enough to handle a large amount of money alone before turning over the account.
You do not need a lot of money to open up an account. For example, the following mutual funds have anywhere from a $25-$100 minimum as long as you continue to invest the minimum each month. These mutual funds have investment options that allow you to invest in growth companies, those with projected earnings growth year after year.
Another powerful mutual fund for today's new investor is BuckInvestor.com. This mutual fund invests in youth-oriented companies such as Coca-Cola, Gap, Nike, Microsoft, Intel, and Compaq. They provide investment education materials in each of their quarterly statements that reinforce the power of investing at a young age.
To you and your teens, happy investing!