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A Good Investment
Teaching Kids How to Invest in the Stock Market By Doris Keeler
Bethany Murphy, an 11-year-old in Mt. Laurel, N.J., is as comfortable around the stock market as most kids her age are around video games. She got her interest in the market from a fourth-grade school project two years ago when she entered the local newspaper's stock contest.
"We chose five stocks, and the newspaper tracked them for us," says Bethany. Even after the contest was over, Bethany kept an eye on "her stocks" and eventually bought shares in one of the companies.
For Bethany's parents, their daughter's investment venture is about more than just making money, it's about teaching her the value of money. Tom and Marie Murphy opened an account for her with Stein Roe Young Investor Fund, a custodial account geared toward teaching kids about investing.
"I set out with the investment with the objective of her learning," says Tom Murphy. "Every quarter Stein Roe sends out a newsletter written where children can understand it."
The newsletter includes investing terms, games and company profiles. It's information that has piqued Bethany's interest. Since her initial investment, Bethany has won an essay contest with the company, which added another $5,000 into her portfolio. Her dad says the money in Stein Roe will stay there for the next eight years and will help with his daughter's college costs.
"I think it's pretty smart to do it at this age," admits Bethany. "You'll be able to understand the stock market before you get older. You can also have money invested so that you'll have money for college."
Robert Grace of McLean, Va., is another Stein Roe Young Investor with aspirations of using some of his investments for college. He's 12 now, but when he was 8, his grandparents opened an account for him. He also owns individual stocks. It's not uncommon in his house for dinner conversations to turn to bears and bulls. Robert's dad, David Grace, says they try to talk about the stock market along with other news events.
"We do look over his stocks with him and the stocks that we own," David Grace says. "It's important to talk about these things. It's a part of life. Kids need to understand, and it effects them now."
