Years ago my mother followed the suggestion of some investment advisor to give her grandchildren gifts of stock in consumer companies. The idea was that owning a piece of some recognized brands would get them interested in the market and grow up to be more savvy investors.
As a result, my son came into a few shares of K-Mart, Pepsi, Wendy's and Tim Hortons, which Wendy's spun off a few years back. I can attest it had none of the desired effects.
Today, two quarterly dividend checks came to him from Wendy's Arby's Group — one for 84¢ and one for 38¢.
And yes, they arrived in separate envelopes with 44¢ postage.
I think we may have sold off the other stocks, but the small lot programs of Wendy's and Tim Hortons still haven't rolled up his shares. We have no particular interest in selling a small amount of stock or wasting our time to stop the company from barely breaking even (or even losing money after printing the checks and paying the transfer agent) on the tiny dividend checks. And the company apparently would rather do it this way, too.
If somebody tells you this is a cute and inexpensive way to turn kids into investors, forget it.
