Child tax credit payments are on the way. American families will receive up to $300 per month for each child under six years old. They'll receive up to $250 per month for kids between the ages of six and 17.
The most important use of this money, of course, is to help take care of your kids' immediate needs. Some Americans receiving the credits, though, will have money left over that can be used to help their children down the road.
This could present an opportunity to teach your children about investing while also investing in their future. Here are three great stocks to buy for your kids with your child tax credit.
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Align Technology
For years, wearing braces was a rite of passage for many teenagers. However, there's an attractive alternative to traditional metal-and-wire braces -- invisible dental aligners. Align Technology (ALGN 2.44%) stands as the leader in this market.
More than 2.6 million teens have already benefited from Align's Invisalign clear aligners. But the company is barely scratching the surface of its opportunity in this market. Teen orthodontic cases make up nearly three-quarters of the 15 million orthodontic case starts each year. Invisalign still only has a single-digit percentage share of this global market.
While your kids might have friends or themselves use Align's products, you could know adults who've used Invisalign as well. More than 70% of Align's Invisalign shipments in the first quarter of 2021 were for adult use.
The healthcare stock has skyrocketed nearly 2,500% over the last 10 years and has risen more than 80% over the last 12 months. Align should have plenty of room to run as it expands further into international markets and aggressively markets Invisalign in the U.S. and Europe.
Disney
There's arguably no company more popular with younger kids than Disney (DIS 1.20%). And with Disney's Marvel and Star Wars franchises continuing to crank out hit movies, older kids are likely to be fans of the company as well.
Just because children know and like a company doesn't necessarily make its shares a good pick for them. Disney stock, though, should be a great one to buy and hold.
The company's Disney+ streaming service has been the big story for over a year. That could change, however, with the economy reopening. For example, Disney's Black Widow movie generated $158 million worldwide at the box office in its opening weekend. The company's theme parks and cruise lines should also enjoy increased momentum if COVID-19 concerns wane.
Over the longer term, Disney has all it needs to keep delivering magic for customers and investors. The company is the hands-down ruler of content. It knows how to monetize that content in myriad ways. Disney also has brand recognition and a commitment to quality that should keep fans coming back for more.
Etsy
For parents looking for a unique gift for their children, Etsy (ETSY 0.19%) could be the answer. The company has carved out a niche for itself by building a platform for merchants to sell hand-made products.
Etsy is also a great place to look for a unique stock to buy for your kids. Its share price has more than quadrupled since the beginning of 2020. The COVID-19 pandemic gave Etsy exposure to a wider market. And many of those customers have become recurring shoppers.
The company pegs its total addressable market at $1.7 trillion. With sales totaling around $1.7 billion last year, Etsy clearly has an enormous opportunity to grow. One way it's moving to capture more of its huge potential market is by making strategic acquisitions.
Just this month, Etsy has wrapped up two major deals. It closed on the acquisition of Brazilian e-commerce marketplace Elo7 on July 6. A week later, the company completed its purchase of fashion reseller Depop.
I think that Etsy could deliver 10 times returns over the long run. Buying the stock now for your kids could be one of the best decisions you'll make for their financial future.
