The 17-Year-Old Millionaire

Question


Hi Barefoot,

I have a 17-year-old son who has a part-time job. He has saved over $1,000 and would like to start investing, but CommSec says he has to be 18 to buy shares. So how can he enter the share market with as little help from me as possible? After all, it is his money and he has worked for it. He is looking at buying Coca-Cola Amatil — I said that, as he drinks enough of it, he might as well own part of it. Or is he just too young to get started? It’s funny — my wife and I have accumulated over $2 million in shares and we are still not sure how to get him started!

Darrell

Scott's Answer


Hi Darrell,

Take a bow, mate, it sounds like you’ve raised a financially fit kid! Most 17-year-olds are more interested in buying Jim Beam and Coke than shares in Coca-Cola Amatil.

Now, while you could buy some Coke shares in your name, in trust for your son, I don’t think it’s a good idea.

What happens if Coke suddenly loses its fizz?

It would be the ultimate aversion therapy! If he loses money it could scare him off shares for life.

So, my advice would be for you to encourage him to keep saving and to experiment on your portfolio. Why not challenge him to select a couple of shares that you invest in? Then the two of you can follow them (without laying any actual money down), and even do some field trips to check out the company’s products and services.

Here’s the thing: when kids become teenagers they often don’t want to talk to their parents.

This is a bond that you can share with your son.

When you talk to your kids about money and investing it lasts a lifetime — trust me.

Scott