This Is the Individual Investor’s Greatest Advantage

Foolish investors know that the best way to invest is to take the long-term approach. Find excellent businesses that you can understand, buy their stocks when the price is fair, and then hold them for long periods of time. And that's the operative word: time. The longer you can hold shares of great businesses, the more time they'll have time to compound and grow. And time is why Motley Fool One analyst Jason Moser introduced his daughters Hannah and Ainsley to investing at such a young age. Now at ages eight and seven (OK, Hannah's birthday is just a couple of weeks away and she'll be nine), they own shares of six different companies, and their portfolio is handily beating the market with a total return of 36% since they started! In this video, Jason and his daughters talk about their two most recent purchases, as well as a couple of other stocks that they think they might like to own one day.

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Read/Post Comments (11) | Recommend This Article (33)

Comments from our Foolish Readers

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  • Report this Comment On December 31, 2013, at 11:03 AM, TMFPennyWise wrote:

    Jason,

    Great video! Hannah and Ainsley are sooooo cute and smart. (They must take after their mother! just kidding). Loved it! They should do a series for kids...

    Seriously, interesting what they had to say about GAP. I was thinking it was out of favor with the tweens and younger but your girls seem to be pretty enthusiastic about it. Like their other pics too, esp. UA and SKUL.

    Thx for making me smile this morning. Happy New Year, J.

    Long on GPS, DIS, SBUX, AAPL

  • Report this Comment On December 31, 2013, at 11:29 AM, TMFJMo wrote:

    @3Fairfield: Thanks! And you're correct...the smarts and cuteness definitely come straight from their mom :)

    A few years back I actually had added GAP to the real money portfolio I was running here at The Fool and truth be told I found a lot to like in my research. The stock was suffering at the time from cotton prices but in looking past that there are a number of solid, popular brands under that GAP umbrella so it didn't surprise me that Hannah is interested in it.

    Thanks for posting and Happy New Year to you too!

    Foolish best,

    Jason

  • Report this Comment On December 31, 2013, at 4:31 PM, looploop71 wrote:

    Great video!

    As a father of two daughters myself this gave me an idea to teach them about investing at an early age. They are only 3 and 6 so perhaps they can get even a more jump on Hannah and Ainsley.

    Also this video once again reminded me to pay attention to what my kids like. We all know what they like is what we as parents tend to buy for them as well as other parents!

  • Report this Comment On December 31, 2013, at 8:22 PM, TMFJMo wrote:

    @looploop71: Thanks so much! The whole idea of getting them started so early was just to get the ball rolling. The lessons and understanding come along with time. I'm certain you'll enjoy teaching your daughters too. And of course please let me know if I can ever help. Happy New Year!

    Foolish best,

    Jason

  • Report this Comment On January 02, 2014, at 6:43 PM, TMFPennyWise wrote:

    Jason, Then you did very nicely with your GPS stock in the past couple of years...

    I like GAP too. My two daughters work at their San Fran headquarters... they like both GAP clothes, and the stock,, and if I do say so myself, they're awfully cute too.!

    It's a company to keep your eye on.

  • Report this Comment On January 03, 2014, at 11:25 AM, xixue wrote:

    Jason

    Thanks for the Vid. Quick Question.

    Did you set up a separate investment account for your kids? If so what kind?

    Thanks

  • Report this Comment On January 09, 2014, at 9:51 AM, TMFJMo wrote:

    @xixue: Good question. In this case I just set up one account. It's just a standard brokerage account with Scottrade with a custodial ownership structure. The idea from the start was that they were going to be doing this together so having two separate accounts would just double the transaction costs which would be a total waste. So it's just the one account and the idea is when they are old enough they will basically just split all the holdings right down the middle.

  • Report this Comment On January 16, 2014, at 8:18 AM, KBecks wrote:

    Really nice episode! I like how Ainsley is holding her hands together just the way you are, and Hannah is a great UA model. They both made great presentations.

    Are the girls putting their own money into the account or are you making a regular basic contribution like a monthly gift? How does your family handle investment money vs. pocket money with the children?

    Thanks,

    Karen

  • Report this Comment On January 16, 2014, at 8:19 AM, KBecks wrote:

    P.S. I have 3 boys, 9, 7 and 5, and am curious about getting 3-way agreement. The girls each make their own picks, or do they have to agree?

  • Report this Comment On January 16, 2014, at 8:20 AM, KBecks wrote:

    One more question, how old were they when you started talking shop with them and set up this program? :)

  • Report this Comment On January 16, 2014, at 9:51 AM, TMFJMo wrote:

    Thank you Karen! They seem to enjoy doing it, so I imagine we'll keep on making the videos. The girls are putting some of their own money (birthdays, tooth fairy, etc.) in to make sure they have a sense of ownership. It teaches them that this is something they can do with their money in addition to the piggy bank and savings account. We help with the rest.

    So the process with the girls is that I will give them four potential ideas to deliberate (stocks that I know, that they know and that will be in their interest level). The two of them deliberate and come up with the final pick (with a little help from me of course). But it's one stock per quarter and it has to be a different one every time (this encourages and teaches diversity). With three kids it could certainly be more difficult if you make them all agree. But the way around that is that you bring it down to two final choices and the three of them vote; one stock will win and you go with the majority rule.

    This all started when they were around 5 & 6 years old because we had stopped to eat lunch at a restaurant one day and I was explaining to them that we owned a few shares of that restaurant, so we were part owners. This piqued their interest and the rest went from there. I just know that the best way to teach the power of investing is to have them witness a living, breathing portfolio that grows up with them. When they're adults they'll be able to grasp just what their money has done for them and they'll still have a lifetime of investing to go.

    Foolish best,

    Jason

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