It’s hard to find gifts for teens and college aged young adults. They have nearly 100% expendable income with their jobs that they can squander at coffee shops and mall stores, plus they usually get all the benefits of a middle class American child living at home: more clothes, food, and entertainment than any kid needs. Gift cards are impersonal and lame. Clothing and music gifts are risky—by the time you wrap the gift, the fad might be over.
We’re starting a new birthday gift idea for our teens: investing.
There are several investment opportunities I’ve found that only cost $100 or less to buy into, and I’ll add a list of links here as I write about them.
This investment idea for teens is Groundfloor real estate loan funding. You can open an account with as little as $10, but to get the free $10 bonus, you need to spend $100. The way Groundfloor works is that you fund part of a loan (or loans) that are crowdfunded for house flippers or people who are refinancing cash out to improve their homes. It’s the cheapest way I’ve found to start investing in real estate—admittedly indirectly, but if the Groundfloor system works out, the money our teens make with it could help fund real real estate investments.
Here is the link to get the Groundfloor $10 bonus offer with as little as $100 invested
The teen gift idea: I’ve linked up Groundfloor to my teen’s bank account and funded his Groundfloor account with $100 (of Mom & Dad’s money—that’s the gift). He’ll automatically get a $10 bonus 30 days after he buys bits of real estate loans with that $100 gift. (use the link above to get your $10 bonus).
The sign up process is immediate, and you can add your (or your teen’s) bank account information and initiate a transfer from the bank to Groundfloor. It takes 24 hours to 3 business days for the funds to appear on Groundfloor so your teen can start investing. If this is a last minute gift, simply type up a gift letter explaining the investment you’ve made in your favorite teen, and give them their login information. You only need a first and last name, email address, phone number, and bank login information to get started (you don’t need a Social Security number).
You can buy into a loan on Groundfloor with as little as $10. We opted to buy in to Groundfloor for $100 to get the $10 free bonus, so our son can buy into 10 different loans for $10 each, or put the whole $100 into one loan, or divide the $100 up any way he chooses.
Loans are generally valued at 10% profit on your investment, but remember your 6th grade math: Interest is based on one year. So if your loan pays 10%, that means that if the loan took a year to repay, you’d earn $10 on a $100 investment. But, these are short term house flipper loans, and most flippers pay off the loan within six months. So if you invest $100 in a loan with a 10% interest rate, and the flipper pays the loan off in 3 months, you will not get $10. You will get $2.50, because 3 months is one fourth of a year. You would not believe how many American adults are on Youtube complaining that they were promised 10% by Groundfloor and they only made $2.50 on $100 after 3 months. Stupid should be taxed.
