Financially savvy kids now stash money in stocks and mutual funds. They're forming investment clubs, tracking their portfolios online and playing stock market simulation games. Not at all, experts say. In addition, there's a practical side to educating the younger generation about concepts like dividends, compound interest and just plain saving for the future. Besides, grown-up investors can actually learn a thing or two about stock picking from these whippersnappers.
Teens are famous for spotting trends and for being alert to what's new.
While the exact number of pint-sized investors is difficult to pinpoint because accounts are often set up in a parent's name, a recent survey showed that 20 percent of American children own mutual funds and 16 percent own stocks. Wall Street is paying attention. After all, today's schoolchildren will be tomorrow's CEOs. Several investment firms have set up Web sites and launched mutual funds just for kids. The prospectus and annual report are written at a child's level.