A long term investment choice for my niece?

I would like to buy my newborn niece a CD or municipal bond, or whatever the best investment option is. My bank has been very unhelpful in the decision making (probably because they don't offer municipal bonds and they are not in the business to best tell me how to allocate my money) and the steps I need to take to do this.

I would like to know what my best options are for this situation and also would like to know what steps I need to take. I'm also young (24 y/o) and have not made an investment such as this before.

I'd like this to be a long term investment to which I may or may not be able to contribute incrementally. Because it's long term, research tells me I should invest in something somewhat high risk (such as municiple bonds) to maximize yield. At the same time I don't want to spend $5000 on a CD and have it only earn 300 bucks after 18 years, CDs seem to have a very low yield. You know?

Any guidance would be greatly appreciated, thanks!

dont ignore your own investments to do this for your neice

but if you dont want to risk money at all then a CD is probably for you, you should easily get 5%, which would start the interest at 250 year, can you start a joint savings account online with her? they make about 5%, are safe and you can easily add money

otherwise a bond would be fine as well i would think

one thing though, if you started a 529 education plan for your neice (in your control) with 5,000 you should get some tax benefits and in 18 years or so in a conservative 8% fund, that 5k is worth about 20k without adding to it, that would help a ton for her college

Bonds are good. and you can buy them in low denominations I think as low as $50. What I do is every birthday, christmas I buy bonds so that way they can be cashed in at a later date.

Kudos to you for wanting to set this up.

I would set up an investment account (which can be set up as a IRA or Roth IRA or regular account depending on what kind of access vs. tax protection you want) with a discount broker like Scottrade or ETrade. Or talk to investment department at your local bank.

When you set up the account the money will go initially into a saving account-style account and accrue some interest. From there you can start moving the money into mutual funds, bonds, stocks or a combination. Just be sure to educate yourself beforehand.

There are some really good sites to learn about investing. I suggest you go there for some info. Motley Fool is really good. The finance section on Yahoo is pretty good too.

Savings bonds and CDs are a decent idea. Forget Muni bonds. Neither you nor your neice are probably in a tax bracket where those make sense. A stock mutual fund would be another good idea, especially for the long haul.

I would suggest that you open a coverdell account at Scottrade.com in your niece's name. Then buy stock in FPL, Florida Power and Light. This is a very stable well run electric utility company, that is also the largest wind farm operator in the US. They pay a nice dividend too.

Here is a link on the company:

http://www.top10traders.com/ViewPost.asp...

If you want to mix in some high risk, put 35% of the money in Tower Tech, TWRT.ob, they make wind tower support structures. Here is a link:

http://www.top10traders.com/ViewPost.asp...

This is from http://www.Top10Traders.com

Hope this helps.

I think your best bet is a brokerage account at Fidelity, Vanguard or the like.... buy a decent mutual fund and let it grow.
Mom and Dad may end up doing a tax form for her in a few years, but it won't be anything major for awhile.
Log onto Fidelity's site and there are phone numbers that you can reach a representative...it can't hurt, and you know you'll be doing it right!