Fees Make a Difference
I was so excited this morning after reading an article in the business section of the Sacramento Bee. It was describing how Wal-Mart is having a positive impact on the environmental practices of companies it does business with, particularly in China. Apparently, if you want to partner with Wal-Mart, you’re going to have to be eco-friendly. Nice.
I was excited because Nathan owns a share of Wal-Mart and when a company does good things, it usually ends up being reflected in the stock price. Eventually. Besides, being eco-friendly really is a good thing for the planet.
Nathan chose to invest in Wal-Mart for this very reason. He liked their focus on socially conscious practices.
I handed Nathan the article to read. I deliberately don’t tell my kids what the article is about because reading the newspaper, especially the business section, is a skill. Heck, sometimes I have to read an article several times before I get the gist.
But Nathan got this one right away. “I knew it,” he said. “They’re doing good stuff for the environment.”
And then he looked a little sad. “Let me see what it’s at now,” he said as he left his Facebook page to check the latest share price.
“It’s at $54. I’ve got a ways to go. I bought one share at $50 plus the transaction fee of $12.95. So it’s going to have to go up to $63 before I break even.”
Okay, these are the times when I wonder what kind of guidance I gave him when he wanted to buy in. I’m very aware of the fees and that in making a purchase, they need to be taken into consideration. Especially if only a few, or in this case, one share is being bought.
Since I’m the one who sits with the kids at the computer when we make our purchases, I can only wonder what planet I was on to allow him to purchase one share which, in effect, plummeted as soon as the purchase was complete. I felt really, really bad. Some guidance I was.
But, it was a good lesson. Although the fees have since gone down to $7.95, it’s still an important factor in making purchases. A factor that neither one of us is going to forget the next time we decide to own a little piece of a company.