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Old 12.05.2017, 12:41
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Ideas for investment for a kid

Hi all,
My son got some money from selling his toys(many many toys). So, he got almost 400CHF. He was telling me that he doesn't want to spend this money on other toys. So, his question was "What shall i do with this money?". He is 10 and i thought maybe i could come with some ideas to invest his money. But, honestly i am not good as such things, therefore, i am looking for ideas from you.
So, any advice would be very useful for me to accomplish this task.
Thank you
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Old 12.05.2017, 12:52
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Re: Ideas for investment for a kid

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Hi all,
My son got some money from selling his toys(many many toys). So, he got almost 400CHF. He was telling me that he doesn't want to spend this money on other toys. So, his question was "What shall i do with this money?". He is 10 and i thought maybe i could come with some ideas to invest his money. But, honestly i am not good as such things, therefore, i am looking for ideas from you.
So, any advice would be very useful for me to accomplish this task.
Thank you
he should import more toys and sell them again and make a profit until he becomes a millionaire from his toy trading empire.
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Old 12.05.2017, 13:08
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Re: Ideas for investment for a kid

Open a savings account. UBS offer 0.5% and CS 1% for kids. Maybe other banks offer more. Set up a standing order to put money into his account monthly, and encourage him to put any money he gets at birthdays etc. into it. It soon mounts up and it encourages a savings mentality.
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Old 12.05.2017, 13:19
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Re: Ideas for investment for a kid

Buy some stocks.

If you are lucky they are the next Apple / Google and he can buy a car with it when he is 18.

If not.. no harm done I guess..

(not entirely serious above.. a bank account etc. is of course the better choice to educate a young one about the value of money)
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Old 12.05.2017, 13:24
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Re: Ideas for investment for a kid

Purchase 400chf of cocaine and sell it to his school friends for 800chf - at his age he is likely to be the only dealer in school.

Repeat - and then get him to hirer bigger kids as protection as he starts selling at the Gymie.

I'll admit this is a slightly riskier strategy to grow the money. But he who dares Rodney!
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Old 12.05.2017, 13:35
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Re: Ideas for investment for a kid

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Open a savings account. UBS offer 0.5% and CS 1% for kids.
What a terrific way to burn some money! 0.4% is current rate of inflation. And with a central hedge fund bank that openly thinks that the franc is overvalued, I personally would not be holding too much onto the currency

Buy some shares. For 400 CHF you could buy almost 5 whole shares of Néstle for example. Sure, it's not as glamorous as Apple or Google, but it surved both world wars and countless stock market crashes. It'll be around and pays a decent dividend. And they make ice cream

Last edited by ivank; 12.05.2017 at 14:09.
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Old 12.05.2017, 14:04
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Re: Ideas for investment for a kid

By shares in some company who's products the child buys, preferably regularly. MacD's, my nephews had shares in a donut chain (Tim Horton's).

Explain that the dividend is a sort of money back scheme for when they buy a donut:

Explain that:
They lent the company 400
They spent 25 there.
They get (n) back.
25-n is less than than 25.

If other people like the company, and it does well, then:
The 400 will become larger.
They will get more than (n) back next time.

Just be careful to explain that the next time they have 400 to burn that it would be smarter to spend 375 on shares, and 25 on donuts than to spend the whole 400 on donuts (makes economic AND dietary sense, but hard to explain to a child.)

Ignore the overhead for purchasing the shares initially - wait until they've got their 25 back and want the 400 again.

(Not my idea, stolen from my BIL who has a phd in economics.)
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Old 12.05.2017, 14:12
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Re: Ideas for investment for a kid

Index funds with low fees are generally seen as the best choice for long term investments, since you spread risk across a basket of companies instead of tying your money to a single stock.

400 CHF with a (low) hypothetical average annual return of 5% over 8 years yields 590 CHF, which far outperforms any savings account.

Of course, you could pick a stock that performs better but you're just as likely to pick one that stagnates or even decreases in value.

On the other hand, picking a stock with a stable value and high annual dividends could also be nice since it stacks on top of the normal stock price increase every year.
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Old 12.05.2017, 14:25
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Re: Ideas for investment for a kid

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Open a savings account. UBS offer 0.5% and CS 1% for kids. Maybe other banks offer more. Set up a standing order to put money into his account monthly, and encourage him to put any money he gets at birthdays etc. into it. It soon mounts up and it encourages a savings mentality.
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Buy some stocks.

If you are lucky they are the next Apple / Google and he can buy a car with it when he is 18.

If not.. no harm done I guess..

(not entirely serious above.. a bank account etc. is of course the better choice to educate a young one about the value of money)
Why not do both?

Split the money, put some in a savings account, some in stocks - but make the process a learning experience.

This is the perfect time to start talking about responsible personal finance. Discuss what it means to have a savings account, discuss other options like stocks. Yes it's a complicated topic, but can be made age-appropriate rather easily.

Ask your son what he might like to save up for, have him think ahead a month, a year, five years. Then talk about secure investments (well, as secure as anything is today), and about risk vs potential reward.

Discuss how much of the chf 400 he might want to keep 'safe' in a bank, how much he might want to put in something riskier. Risk is very hard for a child to understand so you need to think carefully how to approach this topic.

If your child decides he wants to put some portion in the stock market, have him pick the stocks himself. Talk about the kinds of companies he might like, companies that make things he is personally interested in. Research those companies together.

Most banks have some sort of 'Kinderkonto' option, for instance here is Post Finance:
https://www.postfinance.ch/de/priv/prod/acc/child.html

Choose whichever local bank seems to have the most child-friendly program, including an advisor who is willing to sit down with you and your child to talk about opening an account. I have no idea if any banks will help a child with investment, but this is something that should be asked.

Also talk to your son about charitable giving, i.e., 'investing' in his community. Does he want to give some of that money to a local group that interests him?

---


Once you and your son have made the decision where the money goes, then put aside time regularly to help your son watch what is happening to his money.

For child, seeing his own money grow, or shrink, is a necessary lesson. Also keep discussing goals for that money. Learning how long it takes for to make money (either via work such as doing chores, entrepreneurship like selling his toys, or the money being put to work) vs how much/little/temporary/lasting pleasure he gets in buying something with that money is the next key lesson.


Yes, finance is a dry subject - but there are lots of resources out there to help you make it child friendly and interesting.

I remember the young'uns at that age, filled with wonder clutching their first savings books (remember those?) from the first money they earned themselves - budding little robber barons the lot of 'em.
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Old 12.05.2017, 14:32
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Re: Ideas for investment for a kid

Invest in knowledge, that surely will have a neat ROI in a few years.

If he has an slightly tiny bit of interest in technology, my advice, use that money to buy some robots to learn to code and maybe some paid/free courses online to do some development.

Here some examples:
http://www.workingmother.com/stem-to...o-code#page-12
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Old 12.05.2017, 14:41
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Re: Ideas for investment for a kid

why would you recommend a 10 yo how to invest his money he should simply have fun and spend all as fast as possible.

https://www.alpamare.ch/en/
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Old 12.05.2017, 15:30
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Re: Ideas for investment for a kid

hookers and drugs, then he'll be a man
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Old 12.05.2017, 15:33
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Re: Ideas for investment for a kid

Stocks are probably too abstract for a 10yr old to understand, a savings account is more easily understood.

Put some in a savings account that you help feed (xmas, b'day, etc, e.g. double everything he pays in), have some in a piggybank that he can spend part of it more or less at will.
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Old 12.05.2017, 15:33
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Re: Ideas for investment for a kid

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why would you recommend a 10 yo how to invest his money he should simply have fun and spend all as fast as possible.

https://www.alpamare.ch/en/
A ten year old does not need to blow 400 CHF on anything. Spend a little, save/invest the lot. Good plan.
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Old 12.05.2017, 15:37
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Re: Ideas for investment for a kid

Never too early to learn about being responsible with personal finances! I would advise some stock, some savings, and a little "splurge" e.g. the donuts!

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why would you recommend a 10 yo how to invest his money he should simply have fun and spend all as fast as possible.
Sadly a lot of people who learn this at 10 years old never really shake it off, and as adults, are the ones who pile up huge credit card debts and default on their mortgages on properties they couldn't afford to begin with. No, thank you.

Fun and financial responsibility don't have to be mutually exclusive.
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Old 12.05.2017, 15:40
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Re: Ideas for investment for a kid

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hookers and drugs, then he'll be a man
Reminds me of the old joke:

A double glazing salesman rings the doorbell. A 10 year old boy answers the door, bottle of beer in hand, cigarette hanging from his, white powder round his nostrils and 2 scantily clad girls hanging off him.

"Are your mummy and daddy home?" asked the salesman.

"What the eff do you think?"
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Old 12.05.2017, 15:46
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Re: Ideas for investment for a kid

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A ten year old does not need to blow 400 CHF on anything. Spend a little, save/invest the lot. Good plan.


Why teach him that all is about money and how to be greedy starting early age?! As long as he will not suffer from hunger he should have fun. However, I used to buy gifts for mum and dad. That was a good investment for sure. Or my parents were clever:P
P.S. I have no debts. Let me see my bank account, actually I`m doing good :P
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Old 12.05.2017, 15:56
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Re: Ideas for investment for a kid

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Invest in knowledge, that surely will have a neat ROI in a few years.
Best advice ever.

A savings account also, with the specification that these money will be used later, for his studies. He'll feel good knowing there's little something for him when he grows up. Kids like security. At 10 he's big enough to understand this.
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Old 12.05.2017, 15:58
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Re: Ideas for investment for a kid

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He is 10 and i thought maybe i could come with some ideas to invest his money.
10?? I would assume (or hope) there are other priorities, especially since you say you don't understand anything about investing either...

At that age, I still had a piggybank and wouldn't have cared at all about "investing" Tell him to put the money in a savings account, this is as much as a 10-year old should have (on his own that is), imo.

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Best advice ever.
Indeed.
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Old 12.05.2017, 15:59
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Re: Ideas for investment for a kid

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Invest in knowledge, that surely will have a neat ROI in a few years.
That's parents' responsibility to finance his education. Why should the kid spend his own play money on this?

Investing in a stock and being motivated to read all about that particular company and its financials is quite educational too. More educating than investing in index fund and getting burned in a stock market crash, but that's a learning experience too
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