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Best stocks?

August 8th, 2009 | | Tags: | 2 Comments | |

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So, I’ll be turning 16 in December. I already have a car in line for me, so I was thinking about asking my mom to buy me stocks. However, I don’t know what are the best companies to invest stocks in. Also, I don’t know how much they price. some tips would be good! thanks =]

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2 Responses to “Best stocks?”

  1. muncie birder Says:

    Teresathegreat is getting just a tad ahead of herself in her advice to you even though her advice is excellent. You can not deposit money into a Roth IRA unless you have earned income.

    Investing in just one company has a great deal of risk. The company may not do so good. In my opinion a better idea would be to ask your dad to initialize an investment in a mutual fund for you. Then as you earn money you can add to the fund. Mutual funds invest in many companies so if one does not do well, it is only a small % of the total. One of my favorites is PENNX. But there are a lot of other good funds also.

    http://www.roycefunds.com/funds/fundInfo.asp?FundCode=PMF

  2. teresathegreat Says:

    Stocks vary in price, based on how investors view the strength of the company. Each share of stock represents a very small piece of ownership of that company – if the company does well, you earn money.
    You can also buy mutual funds or index funds, where a whole bunch of people pool their money together to buy a whole bunch of stocks.
    Instead of just buying stocks, you might want to ask your dad to contribute the money to your college fund. Or, if you really want to be get ahead of the game, have him invest it in a Roth IRA for you – this is a retirement account that grows tax-free. You can’t really access the money until you retire, but the earlier you start, the better. I know retirement may sound boring, but if you start young if can really make a huge difference in the rest of your life, and you can be laughing while everyone else is counting pennies. Look at it this way: if you put away $2000 every year for the next 10 years into an IRA, and then never put another penny into it, you can retire with a million dollars! Or you can be like most adults and not think about it till your 30s, and then be putting 15% of your paycheck away every month until you retire, and still end up with less. Think how much fun you can have with that extra 15% every month!

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