How to buy Disney stock for a child

How can you buy Disney stock for a child?

Disney stock can be bought by parents of a child by opening a custodial brokerage account and purchasing the stock. Disney stock can be gifted to a child by following your brokerage accounts gifting instructions. In order to gift Disney stock, the child must have a custodial account and you will need to collect the brokerage account number, name of broker, and the brokerage’s DTC number.

Purchasing Disney stock for children is an amazing gift. The child can take ownership in one of the best entertainment Brands around and learn about investing. 

Disney is a great company that will be around for generations to come.

Luckily for you, I’m going to show you how to buy Disney stock for a child or baby. I will even show you how to purchase a paper stock replica, even though Disney discontinued paper stock in 2013. With just a little bit of work, you can give the gift of stock to your favorite child.

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How do I buy Disney stock for a child?

In order to buy Disney stock for a child, the child’s parents will need to open up a custodial brokerage account. The parents can then purchase the stock through the account or you can gift a share via your own brokerage account. Alternatively, you can purchase a Paper Stock replica online.

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Option 1: Guardians can open a custodial account

The easiest way to buy Disney stock for a child is by opening up a custodial account (UTMA/UGMA). A custodial account is an investment account that is overseen by the parents of a child. Legally, the child owns every contribution to the account and the parent manages the assets until the child reaches adulthood.

The reason a custodial account is the easiest path is because the purchase goes directly to the child. You don’t have to worry about purchasing the share yourself and then finding out how to give it later.

To open up a custodial account, you will need to find a brokerage that allows UTMA/UGMA accounts. For example, Vanguard allows you to open up a custodial account for your child.

Once the parents have opened up a custodial account, work with the parents to buy a share of Disney.

Option 2: Gift shares via brokerage accounts

Alternatively, you can gift a share of Disney by purchasing the share yourself and then transferring it to the child’s custodial account.  The share of Disney must be purchased using a brokerage account, not a retirement account. In order to make the transfer, you must own the share of Disney yourself prior to giving it.

The first thing you will want to do is discuss the gift with the parents. You will want to make sure that the parents are okay with you giving stock to their child.

Assuming the parents are okay with the gift, have them open up a custodial account. As previously mentioned, the custodial account is managed by the parents for the child.

Personally, I recommend each party have a Vanguard account, but that is not required. Your specific brokerage will have instructions on gifting shares from one party to the next. For example, here’s the Vanguard page on how to transfer shares between parties.

Transferring from one Vanguard account to the next is easy. All you have to do is get the Vanguard account number from the child’s parents. You will also need an eligible non-retirement account and the share of Disney already purchased.

Transferring from one brokerage account to another brokerage account is a bit more tricky. You will need to gather the child’s name, brokerage account number, brokerage name, and Depository Trust Company (DTC) number.

The DTC number is a four digit number which is used to identify the financial institution. In other words, it helps facilitate the transfer between brokerage accounts. It lets Vanguard know that the funds are going to a TD Ameritrade account or ETrade or any other brokerage.

The transfer should take about a week before the funds are available.

As you can see, gifting a share via brokerage accounts is a bit more hands-on. It is much simpler to have the parents open a custodial account and then make the purchase through a custodial account. However, this option exists if you already own the shares you want to give.

Option 3: Paper Certificate

Lastly, you can purchase a paper certificate that denotes the child is an official shareholder. A lot of people will choose the paper certificate route because you can give something physical and very artistic.

However, it is important to note that Disney has stopped issuing paper certificates. Instead, what you are receiving is a paper certificate replica and not an official piece of stock paper. However, the child will still be an official shareholder.

You can purchase a paper certificate replica through GiveAShare.The stock certificate replica typically arrives within two days of order. Three to seven weeks after the purchase, the stock recipient will receive a statement in the mail with the official stock ownership document.

You should be aware that purchasing a paper certificate costs a little bit more than the actual share. The reason is that you are paying for additional services such as the paper certificate, shipping, and other processing fees.

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Summary: How to buy Disney stock for a child or baby

As you can see, it is possible to buy Disney stock for a child or baby. In most cases, the child will need to open up a custodial account in order to receive the shares. However, you can buy a Paper Stock replica through a company like GiveAShare.

The easiest method is to have the parents open a custodial account. You can then give the parents money to purchase a share of Disney on your behalf. The parents will act as the asset managers of the account until the child becomes an adult.