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It's a popular notion that learning about buying and selling stocks at an early age can spark an interest in investing that will last a lifetime.
Mutual funds, low-cost stock purchase programs and state-sponsored 529 college savings plans combine kid-friendly investing with opportunities to learn about
If you're looking for a holiday gift idea, here are some investing options that not only make for great presents but have real financial value.
_Buy shares directly through the company by taking advantage of DRIPs, short for dividend reinvestment plans. More than 1,300 companies, including Nike, McDonald's, Wal-Mart and
Disney, for example, requires a minimum investment of $175, but the initial deposit is $50 if you choose monthly electronic deductions from your bank account. Dividends are paid in the form of new shares, with no commission.
There are important fees to monitor. With Disney's plan, commissions are just 2 cents a share. But you pay a $20 one-time enrollment fee, plus a $1 fee for automatic electronic investments, or a $7 fee for investments made by check.
_You can also buy shares in a company through an online brokerage firm called Stockpile.com, a relative newcomer to the investment world that touts a "fun, easy and affordable approach" to owning stock. About 20 percent of Stockpile's brokerage accounts are owned by kids and teens, the company said.
There is no minimum amount required to open a brokerage account (with minors, this is a custodial account with mom, dad or another adult on the account).
Investors can also buy a fraction of a full share - also ideal for young stock pickers. Stockpile does not charge a monthly fee and said the trading commission is 99 cents a trade.
Young investors can also use the Stockpile app to place their own buy and sell orders, with parental approval.
One other convenient wrinkle: Buy a Stockpile gift card, and pick a stock and a dollar amount. When the recipient redeems the card, the stock will be registered in his or her account. There's also a gift registry, so friends and family will know your favorite stocks when it comes time for a gift.
_Many mutual fund companies, including Fidelity and Vanguard, market to younger investors. There also are excellent investing tutorials on their websites that teach novices investing basics.
One lesser known but popular mutual fund is the
New investors receive an educational kit that includes a newsletter, a money-themed activity book and a savings bank.
_You can also open a state-sponsored 529 savings account for your future college student. One way to get started is through gift registries offered by companies such as GiftofCollege.com. Family and friends can contribute directly into any new or existing 529. Gift cards are also available.
Aside from all the investment options, owning stock encourages young investors to learn more about the markets and their intricate structures, which could pay dividends even if they never become the next
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