According to the National Retail Federation, Americans will spend an average of $125.92 for Fatherâ€™s Dayâ€”this year, totaling $14.3 billion. (FYI: We spend $21.4 on our momâ€™s for Motherâ€™s Day).
Â Giving Stocks Instead of Gifts
While gifts take money out of the family budget, it might be interesting to consider giving dad a gift that builds it.Â BE.com caught up with Martin Small, BlackRockâ€™s U.S. head of iShares, who recommends a cheap and easy way to get dad into the stock market.
What are ETFs?
Small: Exchange Traded Funds (ETFs) are funds that can be bought or sold in an easy way, just like a stock. Â Theyâ€™re a simple and affordable way for people to get into the market, stay invested, and help achieve the investment outcomes they want. In an era where every penny counts, exceedingly low cost and tax friendly ETFs let you keep more of what you earn.Â ETFs offer opportunities to conveniently invest in virtually every slice of global markets across investment styles and objectives for both stocks and bonds.
How do I buy them?
Small: An exchange traded fund can be bought or sold in a brokerage account, in the same way that you would buy a share of stock. You can also ask your financial advisor. With an ETF, you can know the price of the fund all day long, because it trades on a stock exchange.
How can I make them a gift to my fatherÂ for Father’s Day?
Small: ETFs are investment products that track sectors, indices, and themes. For example, does your Dad geek-out over technology? There is an ETF [Ticker: IYW] that tracks his favorite technology companies,Â includingÂ Apple, Microsoft, and Facebook. Prefer to remind your Dad of the best vacation your family took abroad? Check out an ETF that tracks the investment results of the broad-base of a single countryâ€™s equities market, such as Thailand [THD], Italy [EWI], and Ireland [EIRL] among others.
Getting ETFâ€™s for as Little as $20Â
If you want to give a one-time gift of stock or ETFs and donâ€™t have a lot to spend,Â SparkGift is a great option. The site lets you buy fractions of shares and funds in increments starting at $20. They provide recommendations for popular choices and will send a certificate to the lucky recipient in minutes. SparkGift charges a fee of $2.95, plus 3%. The recipient doesnâ€™t pay anything to redeem their shares or hold their investment.