Why do you invest? For most people, their primary goal is to build a nice-sized retirement nest egg. And that's a worthy aim, to be sure.
There's nothing wrong with thinking bigger, though. What if you could build enough wealth within your lifetime to make -- and keep -- future generations of your family financially independent? Never say never. Just picking the right stocks can help move you in this direction.
With that as the backdrop, here's a closer look at three stocks that could create enough generational wealth to benefit your grandchildren's children -- and maybe beyond.
Walmart
Walmart (WMT 1.57%) is by no means a growth stock. Its typical same-store sales growth is only slightly better than the combination of inflation and population growth. That's in the mid-single digits, at best.
What Walmart lacks in growth firepower, however, it more than makes up for with sheer dominance that ensures it will remain the powerhouse of its category. Think about it. Walmart isn't just the world's biggest brick-and-mortar retailer. It's a competition killer, particularly in the all-important U.S. market, where 90% of the population lives within 10 miles of one of its 5,200 domestic stores.
It has about as many locations outside the United States. Although it's not quite the same wrecking ball overseas as it is here -- at least not yet -- there's a reason it continues to invest in its international expansion. That's money.
Walmart International's CEO, Kath McLay, says this unit is still on track to meet its goal of $200 billion in annual revenue by 2028, well up from last year's comparison of $125 billion. Given this arm's recent growth rate, achieving that target is hardly out of reach. For perspective, the company did $681 billion in business last year.
NASDAQ: WMT
Key Data Points
That said, the qualitative reasons for making a long-term bet on Walmart stock are just as compelling as the quantitative reasons. Simply put, Walmart is solidifying its relationship with customers by evolving into a lifestyle company.
For instance, subscription-based Walmart+ offers free deliveries of online orders, allowing busy consumers to avoid the time spent shopping in-store. Technology installation services are also part of its repertoire, along with veterinary offerings. The retailer even has its own premium private-label wine brand, along with several other high-end grocery goods.
None of these are game-changing in and of themselves. All of them combined, however, position Walmart to remain the dominant name in brick-and-mortar retailing for as long as consumers want to buy stuff.
Coca-Cola
Coca-Cola (KO 0.21%) isn't exactly a growth company either although you might achieve growth-like results with a position in this beverage giant. The key is to reinvest its dividends in more shares of the stock. Thanks to 63 consecutive years of yearly dividend increases, a $100,000 investment in this company 30 years ago would be worth over $1 million today. That's nearly twice the return you'd achieve from the stock's price appreciation alone.
More important to newcomers, there's no reason to think the stock won't replicate this sort of return into the indefinite future. Again, think about it. Consumers may postpone the purchase of a new automobile when money gets tight or opt to take a staycation rather than a vacation. Enjoying their favorite beverages, though, is affordable and comforting in any and all economic environments. That's why Coca-Cola's business is so resilient, even in the toughest of times.
That said, it wouldn't be completely crazy to hold off just a bit before stepping into this particular ticker. Unlike the vast majority of other stocks, this one has actually rallied since early February, reaching a record high just this month. Credit its relatively low risk. Most investors understood that Coca-Cola's business would be able to sidestep the impact of new tariffs. So, it became a highly sought-after name among defensive-minded investors.
Problem? This effort arguably pumped this ticker up a bit too much, pushing it within sight of the analysts' consensus target of $76.46. Patient investors should be able to plug in at a better price sooner or later. Just don't be too stingy or short-sighted. You should be willing to pay a bit of a premium for quality of this caliber.
SoFi Technologies
Finally, add SoFi Technologies (SOFI 0.28%) to your list of stocks that could be capable of creating lasting, multigenerational wealth.
Like plenty of others, the banking business has moved online. A recent survey conducted by the American Bankers Association, in fact, indicates that 55% of the nation's bank customers prefer a mobile app as their first choice for taking care of banking business. Traditional computers are their second-favorite option, but a distant second at only 22%.
Conversely, in-branch visits and phone calls are particularly unpopular ways of banking these days, with only 8% and 4% of consumers, respectively, saying these are their preferred means of interacting with their banks. That's why nearly all major and minor banking outfits now offer some degree of online service, if not a true stand-alone mobile app.
Except, consumers aren't exactly stoked about most legacy banks' digital offerings. They seem far more interested in platforms provided by banks that are built from the ground up to serve online customers.
Enter SoFi Technologies. With nothing more than a passing glance, it looks like any other bank. In addition to checking and savings accounts, SoFi offers consumer credit cards, home loans, investment brokerage services, and even insurance. There is, however, a distinct difference. That is, SoFi is an online bank only; it does not have any brick-and-mortar branches.
Consumers don't seem to mind, though. In fact, they seem to like this relative newcomer's platform a great deal. The company's 10.1 million unique customers are more than 5 times SoFi's customer headcount of less than 1.9 million just four years earlier.
NASDAQ: SOFI
Key Data Points
That's part of what makes this stock such a compelling long-term growth prospect; there's still a massive amount of room for the company to continue penetrating a growing market. In this vein, market research outfit Spherical Insights believes the global online banking market is set to grow at an annualized pace of 13.3% through 2033, likely led by the North American market, where SoFi Technologies is already a dominant name.
Sure, this is a growth stock that will eventually encounter a saturation-prompted headwind. That point in time is well into the future, though, with lots of gains to be made in the meantime.
