Investing Activities for Kids - Motley Fool

By Selena Maranjian

Are you convinced that your kids should start investing? Or that you should be investing for them?

Or maybe you’re considering quietly parking some money in a few stocks or a mutual fund and then forgetting about it.

Think again. 

You can use this opportunity to help your kids learn about investing and the stock market.

Can you really get your kids interested in this stuff? You bet. Here are some activities you and your kids can do together.

Build a mock portfolio

Have your kids make a list of the companies that interest them most. They can get ideas by looking in their closets, in their classrooms, in the mall, on TV, etc.

Look at companies your kids know. Write down the names of 10 to 20 interesting companies, and then record the current stock price of each. Every day, week or month you can check the prices together, see how the stocks are doing, and record the latest prices.

Follow your stocks together

Along with updating the prices periodically, you can scan newspapers, magazines, Fool.com, and other websites for stories about your companies.

Is McDonald’s promoting $0.75 burgers? Will this help the company by bringing in more sales, or will it hurt by decreasing the total profit? And how did the stock market react when it heard of this announcement? Did the stock go up or down?

Consider school subjects other than math as you explore stocks. Investing can relate to most subjects in school and can give kids a bit of a new perspective on their studies. There’s obviously math involved, since they multiply share prices by how many shares they want to buy and perform other calculations with numbers from annual reports. There’s history, too, as they examine how venerable companies like AT&T or Ford got to where they are now.

Start actually investing

Once you’ve become comfortable with the idea of investing in stocks, it’s time to consider buying some shares. You can open a joint brokerage account, with you acting as custodian, but you don’t have to go this far. You can informally “sell” some of your own shares to your child.

For example, if you’re about to buy 100 shares of a particular stock and your child wants to buy a share or two herself, you can just place the order together — and order 101 or 102 shares through your broker. You don’t have to buy round numbers of shares — “odd lots” are okay.

If you do these things, you’ll want to keep a good record of which shares belong to whom. Once your child turns 18, she can open her own account at a brokerage and you can transfer her shares to it.

There’s a lot more to investing, of course, and a lot more that you can do with kids to explore the stock market together. The learning process should prove rewarding — and fun — to both parent and child alike.