AA for a child
-
- Posts: 49
- Joined: Sat Aug 03, 2019 2:44 pm
AA for a child
Hello,
My nephew received a gift from his grandma and his parents were wondering how to invest it.
The kid being young (15), I was considering to suggest to them, an all stock portfolio-
20% S&P
20% US small cap
20% QQQ
20% Intl stock
20% Emerging market stock
I haven't looked up how much of the QQQ overlaps the S&P...
One other possibility is to add a bit of Bitcoin...
Alternatively, I suppose I could suggest one of the Vanguard target retirement funds- 2070 (wonder if it exists yet).
I would appreciate any thoughts.
Thanks.
My nephew received a gift from his grandma and his parents were wondering how to invest it.
The kid being young (15), I was considering to suggest to them, an all stock portfolio-
20% S&P
20% US small cap
20% QQQ
20% Intl stock
20% Emerging market stock
I haven't looked up how much of the QQQ overlaps the S&P...
One other possibility is to add a bit of Bitcoin...
Alternatively, I suppose I could suggest one of the Vanguard target retirement funds- 2070 (wonder if it exists yet).
I would appreciate any thoughts.
Thanks.
Re: AA for a child
How about simply 80% Total Stock Market Index and 20% Total International Stock Index?just_learning wrote: ↑Fri Dec 04, 2020 10:02 pmThe kid being young (15), I was considering to suggest to them, an all stock portfolio-
20% S&P
20% US small cap
20% QQQ
20% Intl stock
20% Emerging market stock
"Never underestimate one's capacity to overestimate one's abilities" - The Dunning-Kruger Effect
-
- Posts: 1219
- Joined: Tue Sep 01, 2020 12:20 pm
- Location: Delaware/Philly
Re: AA for a child
This^^^BolderBoy wrote: ↑Fri Dec 04, 2020 10:16 pmHow about simply 80% Total Stock Market Index and 20% Total International Stock Index?just_learning wrote: ↑Fri Dec 04, 2020 10:02 pmThe kid being young (15), I was considering to suggest to them, an all stock portfolio-
20% S&P
20% US small cap
20% QQQ
20% Intl stock
20% Emerging market stock
Retired June 2023. AA = 55/35/10
- Peter Foley
- Posts: 5533
- Joined: Fri Nov 23, 2007 9:34 am
- Location: Lake Wobegon
Re: AA for a child
If part of this is a learning experience for your child or even for you if you are new to investing, I would start with a simple portfolio such as the one suggested by BolderBoy.
If the funds will be used for college, I would suggest a mix of total stock market and total bond fund because of the shorter time frame.
If the funds will be used for college, I would suggest a mix of total stock market and total bond fund because of the shorter time frame.
Re: AA for a child
You might recommend this book to him:just_learning wrote: ↑Fri Dec 04, 2020 10:02 pm Hello,
My nephew received a gift from his grandma and his parents were wondering how to invest it.
The kid being young (15), I was considering to suggest to them, an all stock portfolio-
20% S&P
20% US small cap
20% QQQ
20% Intl stock
20% Emerging market stock
I haven't looked up how much of the QQQ overlaps the S&P...
One other possibility is to add a bit of Bitcoin...
Alternatively, I suppose I could suggest one of the Vanguard target retirement funds- 2070 (wonder if it exists yet).
I would appreciate any thoughts.
Thanks.
https://www.amazon.com/Second-Grader-Be ... 8&qid=&sr=
Quick fun read and will let him make his own — well informed — decision.
Re: AA for a child
You could make this even more simple and just buy into the Target Retirement or LifeCycle funds. You'd have to eat a little higher ER though.
Re: AA for a child
My recommendation is 100% VTI (Vanguard Total Stock Market). If a dedicated international fund is desired then carve off a small slice (20%) to allocate to an international fund, as recommended above. Simplicity is key, IMO.
Re: AA for a child
What does the child think? Perhaps he wants a car instead?
If he wants to invest his gift, 100% Total Stock Market would be fine.
If he wants to invest his gift, 100% Total Stock Market would be fine.
-
- Posts: 49
- Joined: Sat Aug 03, 2019 2:44 pm
Re: AA for a child
Thank you for your replies.
I think I will suggest he read one of the books first.
I think I will suggest he read one of the books first.
- Brianmcg321
- Posts: 1875
- Joined: Mon Jul 15, 2019 8:23 am
Re: AA for a child
100% in VTSAX.
Keep it simple.
Keep it simple.
Rules to investing: |
1. Don't lose money. |
2. Don't forget rule number 1.
Re: AA for a child
Depends on when the Teen might need the money, and how much is this? For college, a nice bond fund since it will be spent in 4~8 years. If it's not needed for that, then Stock - at least half domestic, but any percentage. I would also seriously look at funding a Roth IRA as soon as the Teen gets a paying job, AND he doesn't need it for college or starting life. If the Grands plan to keep funding the younger generation to get the money out their estate, well, lots more to think about!
Salvia Clevelandii "Winifred Gilman" my favorite. YMMV; not a professional advisor.