Investing for Kids Made Easy

By The Loved Investing Team December 26, 2018

Investing for Kids Made Easy

Overview

  • Start saving and investing while kids are young to achieve more with less
  • Investing small amounts often will provide a nice future nest egg
  • Be diversified and stay in the market
  • When they're old enough, do it together and show them how their money has grown

Cost pressures of children The cost of raising a child to an adult, now on average exceeds $250k. This is increasing more and more, and we want to help parents to ease the pressure whilst doing more. Child care, toys, sports, school, college - the list goes on plus there's always surprises. Be prepared for them as and when they arise.

Start saving and investing while kids are young to achieve more with less Don't hesitate, procrastinate or make excuses, your kids are best off when you invest for them as young as possible. By making investments when they are young, you have the opportunity to maximize the amount of time they are in invested in the market. Being invested for longer, provides a better opportunity for growth and compound returns. By starting a saving and investing plan early, you can achieve more with less. As a parent, the advantage that you have, and your child has, is the time it takes them to grow up. You can easily plan for their goals and what expenses can look like as they grow. By far and large, college is the big one most parents want to be prepared for.

Investing small amounts often will provide a nice future nest egg Investing $5 from birth to they're an adult, can really set them up and showing them the value of compounding. When college is so expensive, one should be contributing small amounts often, easing the pressure whilst achieving more.

Investing is no longer just for the 1%. With Loved fractional investing, you can invest as little as $5 at a time and set it up to repeat as often as you'd like. By investing often you are dollar cost averaging, that is you invest at all different prices, high and low, and take advantage of the growth achievable in a diversified portfolio (up next)

Keep in mind the earlier you start, the longer you are invested. So if their grandparents provided some money at birth, make sure it is working for their advantage, to give the most when they are older.

Be diversified and stay in the market Markets rise and fall, then they rise, then they fall. It happens as part of a rhythm,. The important thing is to stay in the market regardless of the rises and the falls. Using time as your advantage you can see the long term growth in markets, regardless of the ups and downs along the way. It's important to remain diversified, that is not having all your eggs in the one basket, but being invested into diversified selections, with no single stock representing more than about 5% of your whole portfolio.

When they're old enough, show them how their money has grown Investing is a great way to fast track a kids future by helping build financial indepedence while learning about money, investing, companies and the world! Warren Buffett bought his first stock in a compay at age 12 and it helped him learn principals to make him one of the greatest investors of all time.

When your money sits in a back account, teaching your kids the value of compounding is difficult. Do them a favor by investing, so their money works as hard as they do and that they lessons are clearly visible to carry them forward in life. Showing them the companies and industries you invested in for them, having them learn about these investments and the key principals you took in achieving this little nest egg will make them very proud.

Getting started with Loved - Loved is an app offering custodial investing for anyone under 18. Using a custodial UTMA account, kids get their own investments that an adult controls until they turn 18. - Signup in two minutes - due to the Federal Government Patriot Act, you'll need your and your child's social security numbers (SSNs) - Plan goals - set and invest to financial goals to achieve for their early life, a first car or apartment, a college or rainy day fund, or their first bicycle! - Build their portfolio - add familiar investments to their portfolio based on what their future may hold - technology, sustainability, media and entertainment - or familiar companies like Warren Buffett's Berkshire Hathaway, a little bit of Facebook and Amazon. - Teach them - share and learn together with them as we provide education across investing and their own investments

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