Direct Investing for Kids

DRIP Starter Portfolio for Kids

McDonald's Corporation (Ticker: MCD)

McDonald's is a leader in the global fast food industry with over 6,200 company-owned stores and more than 26,000 franchised stores in 117 countries worldwide. The company has increased its dividend every year since 1976 and is know to have a solid management team. Of course, all your child needs to know is that they sell the Happy Meal.

Learning Opportunity: When in McDonald's, you and your child can take a quick survey of what meals others have ordered. Look at the menu and try to come up with an estimate of the average amount spent by each customer surveyed. Explain to your child have higher average spending by each customer helps increase McDonald's profit and his or her stock in the company.

Industry: Restaurant Exchange: NYSELearn more
Shares to qualify: 10/1 Fees for cash: $1.50
Minimum invest.: $50 Maximum invest.: $250,000/year
Hershey Company (Ticker: HSY)

Hershey is much more than those delicious solid, milk chocolate bars. The company also manufactures and sells many other popular brands including Reese's, Kit-Kat, Twizzlers, Almond Joy and Ice Breakers among others. Hershey has raised or maintained its dividend every year since 1997.

Learning Opportunity: Before your child digs into his or her Halloween bag, have them dump all of their candy on the table and split it up by brand. Help them estimate Hershey's market share by calculating what percentage of their candy is a Hershey's brand. Higher market share equals higher profits and --- a higher stock price, of course.

Industry: Specialty Food/Candy Exchange: NYSELearn more
Shares to qualify: 1 Fees for cash: None
Minimum invest.: $50 Maximum invest.: $120,000/year
Walt Disney Company (Ticker: DIS)

The ultimate kid's company, Disney is best known for its animated movies and its theme parks, but it's much more than that. Disney also owns the ABC network, ESPN, Disney Cruise Line, SOAPNet and several live action movie studios. Disney has increased its dividend by an average of 9.6% per year since 2001.

Learning Opportunity: While you're waiting for your next Disney/Pixar movie to start, help your child estimate how much Disney is making from that particular showing. Simply estimate the number of viewers in your theatre and multiply that by the ticket price. Disney's take is usually about 50% of that number.

Industry: Media Congl. Exchange: NYSELearn more
Shares to qualify: 5 Fees for cash: $1
Minimum invest.: $50 Maximum invest.: $250,000/trans
Kellogg Co. (Ticker: K)

Kellogg's brands include its namesake brand Kellogg's, Keebler, Pop-Tarts, Eggo, Cheez-It, Nutri-Grain, Rice Krispies and Morningstar Farms, among others. The company's products are sold in more than 180 countries around the world. Kellogg's has raised or maintained its dividend every year since 1959.

Learning Opportunity: Have your child go through your grocery bag to count the number of Kellogg's products that you purchased. Then, divide that number by the total number of items purchased to calculate Kellogg's "market share". Explain to your child how selling more of a product helps Kellogg increase its profits/stock price.

Industry: Diver. Food Exchange: NYSELearn more
Shares to qualify: 1 Fees for cash: None
Minimum invest.: $50/$25 Maximum invest.: $100,000/year
PepsiCo. (Ticker: PEP)

With its purchase of the Tropicana brand in 1998 and Quaker Oats in 2000, PepsiCo. became much more than a soda company. Today the company's brands include Gatorade, Aquafina, Fritos, Doritos, Cheetos, Lipton and Life, among others. PepsiCo. has increased its dividend every year since 1984.

Learning Opportunity: While in the grocery store, you and your child can observe the soda isle and count the number of people who pick up a Coke product and the number of people who pick up a Pepsi product. Help your child determine what percentage bought Pepsi and discuss the importance of market share with them.

Industry: Beverages Exchange: NYSELearn more
Shares to qualify: 1 Fees for cash: None
Minimum invest.: $50 Maximum invest.: $120,000/year
Johnson & Johnson (Ticker: JNJ)

Johnson & Johnson develops, manufactures and markets a broad variety of consumer products, medical devices & diagnostics and prescription products. Its brands include Listerine, Band-Aid, Purell, Tylenol, Stayfree, Visine, Splenda and Acuvue, among others. J&J has increased its dividend every year since 1972.

Learning Opportunity: Have your child go through your grocery bag to count the number of Kellogg's products that you purchased. Then, divide that number by the total number of items purchased to calculate Kellogg's market share of your grocery list. Explain to your child how selling more of a product helps Kellogg increase its profits which, in turn, helps to increase its stock price.

Industry: Pharmaceuticals Exchange: NYSELearn more
Shares to qualify: 1 Fees for cash: None
Minimum invest.: $25 Maximum invest.: $50,000/year