My son is 13 years old. What is the best way for him to become involved in investing in the stock market?

I'd say you should get him to purchase long term investments like bonds. They may have low returns, but it's not like he will be cashing out in the near future.

Get him a subscription to the Wall Street Journal, then give him a "pretend" stock account. He has to research and invest the money from the account, keeping track of it at least one a week. Give him a long term goal, time frame. See where he is in six weeks, or six months. Remember, the stock market is best for long term investment. If his account makes money, offer him a reward, such as the ability to buy real stock of his choice.

Good luck!

He could start his retirement fund.

Open a brokerage account for him/her and let them know one day they'll have control of it. That won't be until 18, so you can let them know they will have a lot more money in 5 years if you invest it for them wisely. Educate them that becoming rich comes only from investing and not from time-measured work.

I have a 12 year old. I had him start reading about money and the market and business in general so he could get an appreciation for what it all meant. Rich Dad Poor Dad by Robert Kiyosaki is a great place to start.

If he's not already involved in sports,get him involved in one or 2. It will teach him about compatition,which is what the market is all about.

Let him join a fake money tournament like the one on CNBC. That way he can keep track of how he does. Or you could help him open his own account and choose a mutual fund. (individual stocks are probably a little too risky for real money)

I would consider having your son start investing via DRIP (dividend reinvestment programs). These are available from a large amount of the most widely held companies in the market. My Mom started me on this when I was around that age as well through the NAIC who has plans set up with those companies to help you get started. heres the link:

http://www.better-investing.org/Public/default.htm

Each program is direct investing through the company and shares are held at a transfer agent (ie; Bank of New York, Mellon Bank, Computershare). I suggest this as the minimums to open these accounts usually run from $50 to $500 and for a child, thats a lot less savings to do in order to start it up.

A great thing about DRIPs is that you can make additional investments at any time with a very low minimum, likely $25 to $50. This starts your child in the pattern and habit of dollar-cost-averaging. DCA is a great tool when investing in the long-term as it teachs your soon the value of money as it changes when the market goes up or down in terms of buying power.

Also, many companies your soon knows already offer this option. Pepsico, Coca-Cola, McDonalds, IBM, etc.

Here are some great links to explain it more in detail and to also get you started:

Learn:
http://www.fool.com/school/Drips.htm

List of companies:
http://www.directinvesting.com/moneypaper/companies/mp.cfm

Website to help you enroll and consolidate your purchases to the computer, without paperwork:
http://www.sharebuilder.com

Alternatively, you can go to a discount brokerage house such as Scotttrade, Fidelity,Etrade, Schwab, etc. These tend to offer great options as well but usually have minimums near $1000 to $2000 to open an account as well as charging $7-$29 commisions, off from the $2-$5 fees most DRIPs take.

Overall, I would go with DRIPs to begin with and once your child starts making some money during the summers, open a Roth IRA for him. If you need some help with a Roth IRA explaination, thats another question ;)

Hi.

You obviously have a love for stock market investing to want your child to become involved. This will not be an easy task as many adults find it difficult, if not impossible, to make consistent profits investing in the stock market.

May I suggest you begin with something as simple as a Savings Account. Show your child how money grows on its own due to compound interest.

Next, pick a stock that has some attraction to your child and paper trade for a while. A 13 year old likely will be interested in stocks revolving around Game, Music, or Sports companies. What do they love? Find some stocks and follow them.

Point out the risks and rewards of stock market investing. Show and tell.

No-load Mutual Funds are also an excellent area to explore. This is where we have our money. We have conservative and aggressive funds with top managers.
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Jim DeSantis publishes a blog all about money matters at http://on-line-tribune-money-matters.blogspot.com

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