Back in August 2014, I asked my 9 year old son what he thought about me investing his allowance for him. When he was five years old we started his allowance at $1 a week for every year of age. So at five he was getting $5, at six, $6, at seven, $7, at eight years old, $8, and finally at nine, $9. This was set up to go direct into his bank account we opened together in 2010 at age 5.
I asked him back in August 2014 because his allowance had crossed the $1,000 mark, the minimum balance required to open a brokerage account to start trading equities.
I remember going to the bank with him in August and helping him take out his $1,000 in cash from his account so he could give it to me. He seemed pretty excited as he understood right away that it was a good idea to grow his money, and of course he trusted me implicitly…or so I thought! That day at the bank proved to be a bit dicier for me than I thought it would be! Apparently asking a 9 year old to physically hand over $1000 in cash is a bit more of an emotional journey than anticipated, but in the end, he agreed that growing his money was the way to go!
Well today was a very proud moment for me, my trading system in the span of 6 months has doubled his account. I look forward to breaking the news to him later today. The funny thing is, he may not get the significance of it yet, but as he gets older, knowing that he will never have to swap time for money is pretty satisfying for me, and even better, he can do it growing his own money!
Once in a while he asks me “what’s it at now dad?” Well, as the picture shows, his account starting at $1,000 Canadian is now +$2,000 Canadian. An astounding 100% return in 6 months.
Now, if it can do that in 6 months, what will his little account be at when he’s leaving high school? I think it would be cool to post an update every time it doubles on this blog. I am sure I am not the only one that will get a kick out of that.
These kind of returns and more are available in the stock market, and it doesn’t need to be risky either. Do you really think I would have offered to invest my own son’s money if I had even an inkling of doubt that this wouldn’t work out? Not a chance. I look forward to posting the next double, bring on $4,000 by year end!