A Stock Picker's Gift Guide

Looking for a gift to please the investor in the family? Here are five neat ideas, plus some stocking stuffers

Every year I face the challenge of finding a holiday gift for my dad, who claims he has everything he needs already. Buying a gift for him is a "waste of money," he declares, adding that if he wanted something he would get it for himself. But our family Grinch has been investing in the markets as a hobby for decades, so this year I looked for gifts that could help investors learn a thing or two -- and perhaps pay off -- in the years to come. Here are some of the ideas I came up with:

College Savings Plans.
The college savings-account business has exploded. You can get savings bonds, a 529 college-savings plan, or Coverdell Education Savings Account, just to mention a few of the available options (see BW Online, 6/7/05, "Multiple Choice in College Savings"). A Conference Board survey says U.S. households are expected to spend an average of $466 on gifts this holiday season, down from last year's estimate of $476.

Given the chance now, parents said in a recent survey from Boston mutual fund company Fidelity Investments that they would replace one third of their previous gifts with contributions for their children's pending college bills. Fidelity estimates that investing $50 each season in a tax-deferred account that has a 7% rate of return, starting when your kid is three years old, could eventually pay for most of a year's worth of text books.

When I was a child, my grandmother gave me a check for $10,000 that my grandfather had saved from his lifetime earnings as a fireman. Dad invested the money so that it eventually ballooned into 10 times its original worth by the time I graduated from high school. It paid every penny of my Stanford education, and now I can get by without stressing about student loans.

Investing Contests.
If you can tear your kids away from their new Xbox console for a few minutes, youngsters can learn about investing by playing an online stock-market simulator. It costs between $10 and $25 for one shot at playing the Foundation for Investor Education's "Stock Market Game," in which players spar against one another to see who can do best at creating a hypothetical $100,000 portfolio. Most states hold at least two games a year and allow individuals to participate. You can also find a longer list of resources for kids from the Investment Company Institute.

Books.
A couple of new books could give adults plenty of food for thought. Richard Parker wrote one called John Kenneth Galbraith: His Life, His Politics, His Economics (Farrar, Straus & Giroux, $35), which was published in February. Galbraith taught at Harvard during the Depression and worked as an editor of Fortune, among other things. His biography paints the economic history that underlies the present.

Laurence Kotlikoff and Scott Burns's The Coming Generational Storm: What You Need to Know about America's Economic Future (MIT Press, $16.95) also came out this year, as pundits battle over challenges ahead for Social Security and Medicare.

If you're wondering what the finance gurus read, you can find out from J. Bradford DeLong, who was formerly a deputy assistant secretary of the Treasury for economic policy. Now an economics professor at the University of California at Berkeley, DeLong posts book reviews and lists his favorites at www.j-bradford-delong.net. They include William Easterly's The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics (MIT Press, $21.95), which discusses recent attempts to save developing countries from poverty.

(For more business books, see BW, 6/27/05, "The Books of Summer," and 8/22/05, "After The Moon -- What?")

Chill Out and Cruise.
Adventurous investors can also go out to sea. InterShow's "The Inaugural Gold Cruise: Precious Metals, Commodities, & Natural Resource Stocks" leaves from Caldera, Costa Rica, on Jan. 16 and arrives in Miami on Jan. 27. The bears aboard can sun together on deck chairs and later soak up lectures from people like Marc Faber, publisher of The Gloom, Boom, & Doom Report. Addison Wiggin, coauthor of New York Times bestseller Financial Reckoning Day, will discuss the demise of the dollar. It costs $4,590 for a couple to share the cheapest cabin on the ship, and $13,390 buys them a suite that has extras like a bar, personal butler service, and security safe.

Investment Research.
If you know someone who's still learning the ropes about investing, Morningstar (MORN ) provides a wide range of resources and independent advice. Some information on Morningstar.com is free, such as articles that explain investing basics, screening tools to help you pick mutual funds and stocks, and performance charts.

But premium members get more, including analyst recommendations on stocks or funds and a portfolio-manager tool that tracks your investments. The membership costs $13.95 for a month, $125 for a year, $209 for two years, and $299 for three years. Morningstar recently upgraded its services by making it possible for you to import your portfolios from personal software programs such as Excel, Intuit Quicken, Microsoft Money, MSN Money.com, Quicken.com, or Yahoo! Finance.

Those software programs have also been expanding their investment-management capacity in recent years. For example, Intuit (INTU ) came out this summer with personal-finance software upgrades for Quicken that range from $29.99 for Quicken Basic 2006 to $79.99 for Quicken Premier Home & Business 2006 (right now there's an additional $10 discount on all versions.)

The Quicken Premier 2006 software makes it easier for you to manage your electronic documents -- for example, you can now attach them to your account files and convert reports into PDFs. You can also download banking, credit card, and investment information from financial institutions directly into Quicken.

Stocking Stuffers and Collectibles.
Sherri Athay, the gift consultant and founder of Giftelan.com, suggests buying a crystal ball to help investors make decisions. You can find your pick of them on phoenixorion.com. A clear one that includes a stand costs $22.95.

"The one thing you need to think about is what the giver will do with that gift when you give it to them," Athay advises. She also suggests products on wallstreetgifts.com, including numerous bull and bear sculptures that range from under $15 to more than $100. The "Knock-Out Bull," for $99.95, holds up fists in red boxing gloves and sits on the back of a defeated bear.

READER COMMENTS

Ryst is a reporter for BusinessWeek Online in New York. With Susann Rutledge in New York
Edited by Karyn McCormack

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