I would like to start investing for my child on Fidelity. Should I invest in an s&p 500 index fund or a total market index fund for him? I don’t think there is a target date fund for his retirement age yet since he is only 5🤣.
Haha… Yes, in the case of a 5 year old I’m not sure a target date fund makes too much sense. You could always buy a couple funds: A US index fund (like FZROX) and an international index fund (like FZILX). That would provide global market coverage with a 0% expense ratio! Those would be good to hold for many decades to come.
That said, when asked about investing for children, I always remind parents to make sure to take care of their own finance first. Pay off your debt, make sure your own retirement is in good shape. Setting a good example, teaching great financial habits and not being a burden to your children is the gift that will really pay off for their life!
You can always invest for yourself, then simply gift your child stock or index funds later in life. The “gift tax” only actually kicks in after about ELEVEN MILLION DOLLARS. So you can give your kids a lot of money without paying additional tax on it. 
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I did not know we could gift stocks and index and not pay additional tax, thats great to know. Thank so mucn for the info☺
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Hi Bobby,
I think it’s great you are getting your son involved with investing at a you g age. When he is of age, try to open a Roth IRA as well if you can. You are allowed to put in as much as his net annual income per years.
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I agree with this. I plan to open a Roth IRA for my own children and match their contributions. It begs the question though, at what age should they acquire “earned income”? If they have earned income as a child, then compound interest would work astronomically in their favor. I started at the age of 22 but what if I started at the age of 12?! That would be insane. If only. I have hear of some parents doing that for their kids though. I just don’t know how they get their kids to qualify.
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