Author Topic: UGMA Account for Individual Stocks  (Read 935 times)

BigRed

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UGMA Account for Individual Stocks
« on: April 05, 2016, 02:19:51 PM »
My FIL is giving my son (6) a gift to teach him about the stock market.  He wants to get him an individual stock, so my son can learn about how the market works, follow it, etc, and have it tied into something close to my son's interests.  My son is very into sports, so my FIL chose Nike.  Individual stocks are not the best investment strategy overall, but I can see the how this is could be a way to learn about what stocks mean than an index fund, and in any case, it's not my choice, it's a gift.  I'm thinking that the fact the stock bounces around over time without obvious reason might also be a lesson about the intelligence of owning individual stock.

Of course, this being the real world, he didn't actually buy the stock, just told me to go get it, set up a UGMA account and tell him how much it cost to get 6 shares (for the 6th birthday, I guess).  My wife's cousin is also kicking in 6 shares.  He suggested Nike's direct investment program, through compushare, but the fees there are pretty ridiculous.  Where can I set up a UGMA with only a few hundred dollars and not have all the gains disappear to fees?  It looks like Vanguard requires $3000 minimum for such an account.

Also, any advice about how to best present this as a useful lesson to my son would be interesting, too.

ShoulderThingThatGoesUp

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Re: UGMA Account for Individual Stocks
« Reply #1 on: April 06, 2016, 02:26:34 PM »
I have a UGMA account for my daughter for gifts she gets through Schwab. I think it has $1200 in it. I'm not sure what the minimum is for it, or if it has one. There is an $8.95 commission on trades that aren't from their ETFs.

ETA: Account minimum is $100: http://www.schwab.com/public/schwab/investing/accounts_products/accounts/college_savings/custodial_account
« Last Edit: April 06, 2016, 02:29:08 PM by ShoulderThingThatGoesUp »