When Damon Williams bought his first share of Nike stock (NKE), he was just 6 years old. It all started with his addiction to Michael Jordan’s Nike shoe line. “I was a die-hard basketball player pretty much from the age of 4. So growing up in Chicago in the ’90s, you really couldn’t hold your own on the basketball court if you didn’t have a pair of Jordans,” he says. But after buying him one too many pairs of the $70 shoes, his mother, April, closed her wallet. She told her son that if he wanted another pair of Jordans, he would have to save his money and buy a share of Nike stock first. “I was determined to get the Jordans. I really didn’t care too much about the shares,” he admits.
Williams had no idea that a single $30 stock purchase would be the foundation of a $55,000 portfolio 13 years later. Besides accruing the capital appreciation, he learned a valuable lesson. “Anybody can do this. It’s not just for the affluent,” he says. After purchasing that one share of Nike stock, “My mom taught me about ownership and investing, and that I don’t have to [provide] free advertising for these corporations. I can make money with them.” In addition, Williams participated in the Ujamaa Junior Investment Club his mother started for the children of the adult Ujamaa Investment Club, which she also founded.
Financial experts agree that stories like that of Damon and April Williams illustrate one of the best ways to begin teaching children about investing and personal finance. “Parents should encourage teens to invest in companies they know,” says Mellody Hobson, president of Chicago-based Ariel Investments L.L.C. (www.arielinvestments.com). “If they like products from companies like Nike, Apple, or Sony, then encourage them to buy shares of those companies.”
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