1Lun·

Practice makes perfect: The first share portfolio for my son

I think it's never too early to get to grips with the capital market - and that's also true for my son, who will soon be five years old. In a world where financial education is often neglected, I want to give him a feel for long-term investing at an early age.

The basis of his portfolio is a classic MSCI World ETF, which I save with a monthly savings plan of €100. This gives him broad diversification right from the start and allows him to benefit from the long-term growth of the global economy.

I also invest in individual shares that have a direct link to his everyday life and make it easier for him to enter the stock market world. These include:

- $MCD (-0,63 %) (McDonald's) - A company that almost every child knows and has a strong global presence.

- $CAT (-1,98 %) (Caterpillar) - As a little excavator fan, this is a must in his portfolio.

- $TNIE (+0 %) (Tonies SE) - He uses the Toniebox every day, so why not invest in the company too?

- $MAT (-0,15 %) (Mattel) - With strong brands such as Hot Wheels and Fisher-Price, a company that supplies many childhood products.

I'm less interested in short-term profits than in teaching him through play that companies he comes into contact with every day can also be traded on the stock market. In the long term, he can experience how investments grow - and hopefully learn to appreciate the value of long-term thinking and sound investments.

27 Comentarios

CrashBurner@Psychedelic_Sunflower

1Lun

A great idea. Every child could wish for that.

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Leo@wealth_maximizer_149

1Lun

I think you should let a child be a child for as long as possible, after all they will have to take care of all the "adult" stuff soon enough. I think you can start at 15, but it just doesn't make sense before then.

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Metis@Metis

1Lun

@wealth_maximizer_149 Exactly, rather at the age when many teenagers rebel and don't give a shit about what their parents say and would rather consume money the way they are shown on the internet. 🤣

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Epi@Epi

1Lun

@Metis That is why education should first focus on the correct handling of money.
If this fails, all share gains are pointless.

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Peter@Beeferking76

1Lun

$D5V0 more expensive in TER, but clever long-term strategy, I save for my kids

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J. R.@stock_whiz_492

1Lun

@Beeferking76 I agree with you and do the same for my child

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David@Redfox77

1Lun

Perhaps $LLY or similar to go with $MCD?

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Echsenkönig Atokarn@Bezehgombjuderstimme

1Lun

It's the same situation for me. I'm currently building up my portfolio and wanted to create one for my son with world ETFs. For the sake of simplicity, I had thought about saving in just one ETF, but I wanted to use one that also includes emerging markets.
I think the idea with the shares is really good. I think I could do that too 🙏🏻

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Nobody@Nobody_123

1Lun

Everything is right and great! But I personally would be a bit careful with the use of trademarks. You don't want to get stressed.

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Thomas Z.@MisterFogg

1Lun

@Nobody_123 Thanks for the tip, I have adjusted the image 😊

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Aktienmasseur@Aktienmasseur

1Lun

It's nice to teach the child counterproductive stock picking. How many investors perform better with individual stocks than with an ETF?

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Thomas Z.@MisterFogg

1Lun

@Aktienmasseur over 90% of his portfolio is in an ETF (mainly financed from the monthly savings plan and Christmas presents etc.). I understand what you mean, you can't teach a 5 year old much in this respect anyway, so the risk is rather low.

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InvestmentOma@market_sorcerer_985

1Lun

What a great idea!!! This is exactly what I have in mind for my grandson. I've set up a €50 savings plan for him with inflation compensation in an MSCI ACWI, just in time for his birthday. The individual shares are another bonus to introduce him to the world of money early enough and in a fun way.

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Melly@melly-m

3Semana

At the time, I took my children around the apartment and showed them everything that comes from an exchange-traded company.
Both have a securities account with an all World ETF. They always want to know how the portfolio is doing and the little one (11) often voluntarily puts money she has saved into the portfolio.

The older one (13) is now allowed to go to a trade fair for the 3rd year. It's the highlight for her, as we also meet some friends there who invest.

Both of them now know a few companies and are already making suggestions about what to buy in mummy's portfolio.

Of course, there's no compulsion and they don't have to. But if they want to know something or have suggestions, we talk about it

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user5ca946a11b6a4278@user5ca946a11b6a4278

1Lun

A good idea, but I would simply save 1-2 ETFs. MSCI world quality + nasdaq, for example.
And don't forget Bitcoin.

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Epi@Epi

1Lun

As long as everything goes up, that's all well and good.
But what does it do to a 6-year-old when he sees that the €100 savings installment is lost at the end of the month due to price losses and that over many months?
There are two sides to everything. You should at least consider that.

Otherwise, good plan!

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Thomas Z.@MisterFogg

1Lun

@Epi At the end of the day, an almost 5-year-old can't really categorize the numbers yet and it's not as if he's looking at the numbers. The coins in his piggy bank, which he can spend at will in the kiosk, at the fair or in the toy store, are worth much more to him anyway. He is still far too young to realize falling prices.

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Epi@Epi

1Lun

@MisterFogg I started mine with silver coins. I added a nice one every holiday and every few months I looked together to see what the silver treasure was worth. Between 6 and 9 that was enough for the financial market.
The real financial education took place on the spending side anyway. A little pocket money, saving for wishes, subsidies from parents for books, classified ads for buying and selling toys.
Building up capital by increasing the value of shares in companies - that was only really tangible from around 15.

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InvestmentOma@market_sorcerer_985

1Lun

@Epi I think we should trust our children much more than we currently do. If they grow up playing with it in a protected environment, they internalize the positive and negative sides of emotions such as fear and greed, joy and loss much faster and better. And they understand right from the start what is behind the brands that we buy so regularly, especially for them. Children are influenced by advertising much earlier than we generally assume. With the help of such money and stock market games, we can steer their attention in the right direction.

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Epi@Epi

1Lun

@market_sorcerer_985 I agree with you!
The art of parenting is to neither under- nor overburden children.
Dealing with emotions must be learned at an early age. Understanding capital market movements and explaining them using behavioral finance findings takes time and should be reserved for those who are interested in it. Otherwise nothing will stick anyway.

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InvestmentOma@market_sorcerer_985

1Lun

@Epi That's absolutely true, of course. You can't push a child into a corner where they don't see themselves, but you can offer it. I did this with both my children and they reacted very differently to this offer. They even had to grow up first to find their own way, which is very different for both children. But I planted the seed in the ground a long time ago and then let them do it themselves, and I still give them an insight into my way of dealing with money and the bad mistakes I made myself.

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InvestmentOma@market_sorcerer_985

1Lun

@Epi great approach! Exactly, financial education takes place on the expenditure side. And that's exactly where you can direct it. My son wanted Adidas shoes when he was 11 years old. The children's size was still within reason, but paying the adult size for a child was too much for me, he already had such big feet. So we made a deal: I would pay as much as the children's shoes cost, and you would pay the rest. My son quickly moved away from branded shoes and opted for non-name brands. If I had invested in shares back then, it would have been worth an Adidas share for his portfolio.

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ECB_Hater@ECB_Hater

1Lun

Cool idea! 🚀

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Haberlapp@Haberlapp

1Lun

It's ok to help the next generation with an ETF for later. Individual shares and gimmicks perhaps with a demo account....

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Diogo T.@DCTAVARES

1Lun

If you dont mind, your son´s portofolio, is in your portofolio right?
Im askinng cause not while a go i was searching for a way to invest a small amount every month for my son , to give it to him on his 18th birthday, its not legal in my country.

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Markus H.@m_homm

1Lun

I think that's great! Since our son was born, I've been putting the child benefit plus 100 euros into MSCI world, S&P and Dow. I'll just let it run for him until he's 18 years old.

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MaikelKnight@MaikelKnight

4Semana

I take a very similar approach and save for my two kids (7 & 10) in junior custody accounts with a world ETF (90%) and a dividend ETF (10%). The dividend portion is also only for the purpose of utilizing the tax-free allowance.

You know that you have a custody account. If you really want to know more about it, I am completely open. So far, it's (fortunately) completely within reason. My junior would probably blow it all on LEGO and dinosaurs. This "adult stuff" will come soon enough and when I feel that the money topic has been at least roughly understood, they can do what they want with it.

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