15 Best Stocks For Kids & Teens in 2024
Teaching kids to invest is one of the finest gifts you can give them. Because, as we know, time is one of your best assets when investing. The sooner you get your kids in “the game,” the better off they’ll be!
What are good stocks for kids to buy?
The best stocks for kids and teens are the companies that they understand. You want businesses that they are excited about owning a piece of and seeing grow.
My 11-year-old son has been asking to invest for over a year. And, though I have no problem making my own investments, I struggled to introduce it to my kids.
Here were my issues:
- I’m a tired mom who doesn’t want to open more accounts to start.
- I wasn’t sure if they could invest only $20.
- Many investing apps cost money. I’m not ready to pay.
So, after much debate, this article explains what we did to get our kids investing. The step-by-step guide worked well for us, but keep in mind that everyone’s situation and perspective are different.
Explain What a Stock Is
First, I wanted the kids to understand what we were doing, and that there is risk involved. Here’s the simple way I explained it:
Buying a stock is owning a very small piece of the company.
If the company grows, you (the people who invested) are rewarded through a higher stock price or payouts (dividends). If the company or economy goes through hard times, you could lose your money.
Be Clear About Your Goal & Parameters
Everyone’s goals are different.
But our goal is to help the kids learn the basics. To learn:
- the correlation between risk and reward
- how companies grow and make money for shareholders
- investing can be used as a tool to make your money multiply. (Compound interest and the value of time)
Our investing exercise is NOT
- to make a boatload of money for them or myself.
- to invest in their college education or anything of a serious nature. (We have a separate 529 account for that)
Most importantly, I wanted this to be a good first experience for them.
I also communicated clearly that they need to keep the stock for at least a year.
Statistically, the longer you hold on to the stock, the better your odds of making money. Once we went over this, they readily agreed.
“Invest for the long haul. Don’t get too greedy and don’t get too scared”.
(Shelby M C Davis.)
Make a list of companies
Next, the kids made a list of companies that they think do an excellent job. By having them help, I know that the businesses are simple enough for them to understand, as well as companies they are actually interested in.
It’s also important that the companies they pick are strong. You want businesses that last. So, strong household names with stable financial foundations are best. You are teaching them to take a futuristic view.
Disclaimer: This article is for educational purposes only. These stocks are not individualized investment recommendations. Use your own research and discretion.
Here is our kid-friendly list:
Nike (NYSE: NKE)
Nike is the world’s largest supplier of athletic shoes and apparel and is a major manufacturer of sports equipment. It’s a brand that most kids are familiar with either because they own shoes/clothes themselves or because they have seen others.
Disney (NYSE: DIS)
The Walt Disney Company is a leading international family entertainment and media enterprise.
It consists of:
- media networks
- parks and resorts
- studio entertainment
- consumer product
- interactive media
For many decades it has been known for its exceptional storytelling. Unless you live under a rock, your child will have come in contact with this brand hundreds or thousands of times by the age of 10.
Netflix (NASDAQ: NFLX)
Unlike many other media companies, Netflix does not sell advertising. Nor does it sell its user data. Instead, it has been one of the pioneers of subscription-based content. Subscribers pay monthly to access the vast library of shows and movies.
Hershey Co (NYSE: HSY)
Hershey Co is one of the largest chocolate manufacturers in the world.
It makes many of the candy bars America likes best (Hello, Reeses) but also manufactures other products like Skinny Pop and Pirate’s Booty.
Chipotle (NYSE: CMG)
Our family has been Chipotle lovers for years, so it’s no surprise this one made it to the best stocks for teens and kids list.
Chipotle is a restaurant chain that offers a focused menu of burritos, tacos, burrito bowls, and salads. It uses simple ingredients and classic cooking methods. Plus, the guac is out of this world.
Microsoft (NASDAQ: MSFT)
Microsoft is the owner of Minecraft, and that’s really why it made it on our list!
But Microsoft is probably best known for the Microsoft Office Suite, Internet Explorer, and Edge web browsers these days. It also owns the Xbox video game consoles and Microsoft Surface computer line.
Amazon (NASDAQ: AMZN)
Amazon can give you almost anything you want without having to leave your house (or wait weeks for it). They lead the retail world these days because they’ve completely disrupted the industry.
And yet, Amazon is so much more. It is also the world’s biggest cloud provider, it runs Amazon Prime’s entertainment service, and it is one of the biggest advertising companies.
McDonald’s (NYSE: MCD)
McDonald’s is a global fast-food chain known for its consistent earnings and dividends. In fact, McDonald’s is the world’s leading global food service retailer with over 38,000 locations in more than 100 countries (source).
Related: How to Invest $500 For Beginners
Apple (NASDAQ: AAPL)
Apple sells products (iPhones, Mac, and Ipad) as well as subscription-based services like Apple Music and iCloud.
Apple is known for delivering the best quality and has gained the trust of millions over the years. Our family fits into this category, and the kids noticed that multiple home products come from Apple.
Garmin (NYSE: GRMN)
My son is a big fan of his fitness watch! But Garmin also makes GPS navigation and wearable technology across the automotive, aviation, marine, and outdoor markets.
Mattel Inc (NASDAQ: MAT)
Mattel is a leading global toy company. It produces many of the most well-known brands of today, including Barbie®, Hot Wheels®, Fisher-Price®, American Girl®, Thomas & Friends®, and more.
Hasbro (NASDAQ: HAS)
Like Mattel, Hasbro is a leading toy maker. Its products include Nerf, My Little Pony, Transformers, and more.
Alphabet (NASDAQ: GOOGL)
Alphabet has two key businesses that your child knows about. They are the world’s leading search engine, as well as the owner of Youtube. Basically, if you are looking for anything, Google’s parent company is likely how you find it online.
Other strong household names include: Coca-Cola, Johnson & Johnson, Proctor & Gamble, & CVS.
The last two on our list aren’t as “tried and true” of companies, but my kids love tech, so they came out as options!
Roblox (NYSE: RBLX)
My kids are Roblox fanatics these days.
They’ve even used real birthday money to buy the virtual currency Robux (which I think is crazy). While Roblox makes money through in-game purchases, it also sees revenue through advertising and premium memberships.
Tesla (NASDAQ: TSLA)
Tesla is on our list because my husband has been obsessed with the company for years. Kids pick up on that!
Tesla designs and manufactures electric cars and trucks, stationary battery energy devices, solar panels, and solar roof tiles.
Index Funds (One-Stop Shop For Best Kids Stocks)
You don’t have to pick just one! Index funds are a great way to invest in a diversified group of stocks or bonds. By investing in these funds, your child or teenager can learn about multiple sectors and industries without having to pick individual stocks. It also helps them understand diversification.
Related: How to Teach Childen to Save
Research the Best Stocks (Kids & Teens)
First, we found that some businesses that my kids love aren’t currently public (Chik-Fil-A and Lego got cut).
Then, the kids picked their 2-3 favorites and looked at them on Vanguard to see how the company has done over the last 5 to 10 years. You can readily find this information online, even if you don’t use a brokerage.
Warning: Don’t get caught up in paralysis by analysis. Look at the best kids stocks and do your research, but then make a decision. Remember: The smallest action is better than the largest intention!
Decide how you Will Buy The Stock
What We Did (The Easy Starter)
Instead of opening yet another account, the kids gave us $20 and we bought the stock for them through a joint brokerage account (non-retirement) we already had.
We bought 1 share of whatever they picked and covered everything above the $20. We’ll do the math later to determine how much they made off of their $20 investment.
Here’s what happened:
My son wanted Disney, but wasn’t sure about their performance over the last five years. So, he picked Netflix. (The next day, I bought a share of Disney as well so that we could look at what happens in comparison.)
My 9-year-old daughter picked Tesla. There’s absolutely no logic here except for the fact that she really likes the car, and she knows her parents have invested in it in the past.
The Next Step: Opening a Custodial Account
This account is great because it transfers to your child once they reach legal age (usually 18 or 21). So you don’t have to deal with the math and ownership dilemma like the option above.
As it turns out, you can open these through most brokerage firms, and they allow you to invest in fractional shares. Be prepared to provide Social Security numbers and birthdates when you do it though. And understand that any money that goes into this account becomes theirs. It can not be retrieved by anyone but the account holder, regardless of who put the money in.
Now, Let It Ride
As much as I procrastinated, using the starter way was actually fun and quick. I needed to break it down into something smaller for us to START.
While I can’t guarantee that the stocks they picked will soar, I feel confident that they’ll learn…
- Patience. This money isn’t for short-term fun
- How to look at a stock’s past performance
- Investing is an avenue to make money
- Why it might be best to hold more than one stock (diversification)
- More important financial literacy concepts, like dollar cost averaging
And based on sound investing facts, I think they’ll do well as long as we hold on to them for a good chunk of time.
If they stay excited, we’ll do it again. At that time, we’ll add index funds and the custodial account into the mix. Then, just rinse and repeat.
Don’t Forget: Best Kids & Teens Stocks
By following these tips, your kids will be excited to learn and grow!
Plus, you’ll be giving them far more than a crummy plastic toy that clutters your house and breaks in a month. It’s a financial education that pays itself back for life. How awesome!
What’s Next?
- Teach kids budgeting methods (and snag the free printable)
- Find the best money books for kids
- Help kids with ideas for how to make money in other ways
