Is there something I can buy my new nephew that will grown in value as he ages? Is that a bond?

Forgive my ignorance in financial matters, but I want to invest a semi-small amount of money in something for my baby nephew so that he'll have a larger amount of money when he's older (18 maybe). Is there an easy way to do this? Can I buy something with a large face value that'll mature when he's older? If so, how do I do this? Any help that you can provide me would me much appreciated since I know nothing about this!

savings bonds don't yield a very high return and it takes several years for them to mature. For example if you pay 20 dollars for a 60 dollar bond it would take like 20 years for it to mature to 60 dollars. The best thing to do is open a savings account in his name. That way anyone can deposit a little money in it and over the years he could have a pretty good nest egg. My sister did that for my son and he is 16 next month and has enough to buy a pretty good vehicle and insurance for a year. So it works pretty good.

I would suggest putting money in a savings account and once you have enough (or if you already have enough skip the savings account) putting it in a long term cd. Those have great interest rates and you can get one that rolls over every 1, 2, 4, 5, etc. years depending on what you want.

If its just $25 or $50 you are looking to give him, try a savings bond. But they take forever to mature and don't gain any interest until after they mature, and then barely any at all.

When Google went public with their stock, you should have bought 5 shares of it. That was less than $500 then. Now it be $2,500. This type of investment not happen often.
I would talk to a bank, mutual fund or investment company. Ask about a Trust Fund and ALL the details.
I just use a Stock Account with Scottrade for my son. I laugh and say; "He will retire when he graduates high school".

It is always a difficult choice between "low risk/low reward"and "hight risk/high reward" investment.

A low risk/low reward investment might be something like a government saving bond.

A high risk/high reward invesment might be something like a dot com company.

The middle of the road approach and one I have used is a indexed mutual fund from a company like Vanguard. (Vanguard.com) They are a conservative, well known and respected mutual fund company.

You should also look into one of the investment vehicles allowed by the government for educational savings. I believe they are called 529 college savings plans.

a zero coupon bond grows very fast and no coupon needs to be touched.

these are excellent for working with creatively.

also, get him books on being self-employed and on investing; learn together!!!

[if he is too young, put them aside till he is old enough]

if you want your best return, i would say a savings bond. it will have matured by the time he is 18. no savings account will really get much interest.

okay.. this may be off the beaten path.. but what about buying some rare stamps, or rare base ball card for your nephew.. because those always increase in value, and they hold a sentimental value as well.

If you have over $250 or so, you can invest in a no-load mutual fund for him. I would recommend an aggressive equity fund. They appreciate in value without income to pay taxes on.