Question: I am a volunteer volleyball coach for a local middle school here in Nevada City. Last year, the school generously gave me $300 for my work with the team. Instead of cashing it in, I'd like to invest it and let it grow into volleyball scholarship for future players. Any suggestions on how I can do this? Anna, Nevada City, CA.
Kristof: This is great. The answer depends on what your goals are, what you want to do with the money. The challenge is that it's extremely difficult if you try to invest it in something with better than CD-like returns. For the moment, there isn't much to do with this except to keep it in a bank account.
Then, on a related note, what if you opened it up and get other people to donate? Let the other parents in the volleyball program know that you'd like to create a scholarship fund and would they like to donate to it. At the end of the year the money will go to a deserving student. I would also talk to the people that administer the volleyball program and see if they already have a program like this.
(Edited. You can listen to Kathy Kristof take other questions--and learn about the dog that fetches firewood--here.)