Author Topic: Best place to start investment for little sister?  (Read 1255 times)

mozar

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Best place to start investment for little sister?
« on: July 02, 2018, 03:20:39 PM »
The problem is that my dad only gave me $100 to start it. I wish I could make the difference and buy a Vanguard index fund for 1000 but I can't afford to right now. If I got an ETF does that mean I would have to pick the company? Any other suggestions? I want her to have something in her name.

Trifele

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Re: Best place to start investment for little sister?
« Reply #1 on: July 02, 2018, 05:26:41 PM »
How old is your sister?  Are you thinking of a custodial account on her behalf?  Does she have earned income?

Schwab has funds with really low minimums.

mozar

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Re: Best place to start investment for little sister?
« Reply #2 on: July 02, 2018, 07:11:58 PM »
She is 7. Yeah I guess it would be custodial. I will look at Schwab.

Trifele

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Re: Best place to start investment for little sister?
« Reply #3 on: July 03, 2018, 04:24:47 AM »
Yes, Schwab is really good for the custodials.  It's been a few years since I opened my kids' accounts, but the minimums at that time were $100.  And then a minimum buy amount of $1 at a time -- perfect for a kid.  We've been very satisfied with Schwab.

You can't go wrong with their S&P 500 Index Fund (SWPPX) or their Total Stock Market Index Fund (SWTSX-- fees are only .03% for both.  Definitely go for a low-fee index fund, rather than an actively managed fund.

Good for you for doing this! Her future self will thank you.     

mozar

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Re: Best place to start investment for little sister?
« Reply #4 on: July 03, 2018, 01:56:19 PM »
Quote
you can't go wrong with their S&P 500 Index Fund (SWPPX) or their Total Stock Market Index Fund

Thanks for the info!

begood

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Re: Best place to start investment for little sister?
« Reply #5 on: July 04, 2018, 03:15:55 PM »
You could also put it in your name with the idea of adding her name to it in the future. That's what we are doing with a 4-in-1 fund at Fidelity. Our daughter is too young to be named, and custodial can be complicated. We plan to add her to the account when she's 18 and take ourselves off it when she's fully launched.

It may be different with a sibling than a parent/child, so check with the fund administrator.

mozar

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Re: Best place to start investment for little sister?
« Reply #6 on: July 04, 2018, 08:59:36 PM »
I was able to do a Schwab custodial account pretty easily.

AZDude

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Re: Best place to start investment for little sister?
« Reply #7 on: July 05, 2018, 12:44:27 PM »
You could also put it in your name with the idea of adding her name to it in the future. That's what we are doing with a 4-in-1 fund at Fidelity. Our daughter is too young to be named, and custodial can be complicated. We plan to add her to the account when she's 18 and take ourselves off it when she's fully launched.

It may be different with a sibling than a parent/child, so check with the fund administrator.

No offense to you, but this seems like terrible advice to the general public. Imagine something drastic happens, lawsuit bankrupts you, disability, etc... and you suddenly face dire financial circumstances. Dipping into that account would be awfully tempting.

Again, not saying *you* would do it, but with a custodial account there would at least be less temptation and more accountability.

begood

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Re: Best place to start investment for little sister?
« Reply #8 on: July 05, 2018, 03:01:35 PM »
You could also put it in your name with the idea of adding her name to it in the future. That's what we are doing with a 4-in-1 fund at Fidelity. Our daughter is too young to be named, and custodial can be complicated. We plan to add her to the account when she's 18 and take ourselves off it when she's fully launched.

It may be different with a sibling than a parent/child, so check with the fund administrator.

No offense to you, but this seems like terrible advice to the general public. Imagine something drastic happens, lawsuit bankrupts you, disability, etc... and you suddenly face dire financial circumstances. Dipping into that account would be awfully tempting.

Again, not saying *you* would do it, but with a custodial account there would at least be less temptation and more accountability.

It's not advice for the general public. It's advice for @mozar. It's true that it relies on a factor of integrity, but from what I've read of mozar's situation with her sister, I'm not concerned that she would abscond with that $100 investment.

[Edited to Add] I see mozar started a custodial account at Schwab. Good job! Way to get the ball rolling.

mozar

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Re: Best place to start investment for little sister?
« Reply #9 on: July 05, 2018, 05:20:46 PM »
aww thanks @begood