The stock market may seem like a place for adults in suits, but the truth is, teenagers can start learning about investing early – and that can make a big difference in their financial future. With the right approach, teenagers can begin exploring how the stock market works, and in some cases, even start investing with the help of a parent or guardian.
In this article, we’ll break down everything teens (and their families) need to know to get started with the stock market – step by step, in simple language.
What Is the Stock Market?
The stock market is where people buy and sell shares of companies. When you buy a stock, you’re owning a small piece of that company. If the company does well, your stock value goes up. If the company doesn’t do well, the value may go down.
Investing in the stock market is one of the most popular ways to build wealth over time – and the earlier you start learning, the better your results can be later in life.
Why Should Teenagers Learn About Stocks?
There are a few big reasons why teens should start learning about the stock market:
- Build good money habits early
- Understand how businesses grow
- Learn to think long term
- Benefit from compounding (the power of earning interest on interest over time)
The earlier you start investing, the more time your money has to grow.
Can Teenagers Legally Invest?
Yes – but there’s a rule. Teens under 18 can’t open their own brokerage account alone. However, parents or guardians can open a custodial account on their behalf. These accounts allow parents to manage investments until the teen reaches the legal age (usually 18 or 21, depending on the state).
Popular custodial accounts include:
- UGMA/UTMA accounts (Uniform Gifts/Transfers to Minors Act)
- Custodial Roth IRA (for teens with earned income)
- Brokerage accounts with parental control (Fidelity Youth Account, Greenlight, etc.)
How to Start Investing as a Teen
Here’s a simple step-by-step path for teens and their parents:
Start learning first – Before investing real money, take time to learn the basics. Read books, watch videos, or try a stock market simulation app.
Talk to a parent or guardian – If you’re under 18, you’ll need their help to open an account.
Choose a brokerage platform – Look for one with low fees, beginner-friendly tools, and educational content. Fidelity, Charles Schwab, and Greenlight are good options.
Start small – You don’t need thousands of dollars to begin. Many platforms allow you to invest with as little as $5 or $10 through fractional shares.
Invest in simple options – Consider starting with index funds or ETFs, which are baskets of many companies. These are safer and easier to understand than picking individual stocks.
Smart Tips for Teen Investors
Think long term – Investing is not about getting rich overnight. It’s about growing money over years.
Don’t panic during market drops – Prices go up and down. That’s normal. Stay focused on your goals.
Keep learning – The stock market is always changing. Follow news, trends, and keep educating yourself.
Avoid risky or trendy stocks – Meme stocks and social media hype may be exciting, but they come with big risks.
Learn With Simulators
Not ready to invest real money yet? That’s okay! You can practice investing using stock market simulators like:
- Investopedia Stock Simulator
- HowTheMarketWorks
- MarketWatch Virtual Stock Exchange
These tools let you trade with fake money while learning real strategies.
Final Thoughts
You don’t have to wait until you’re an adult to start learning how money and investing work. The stock market can be an exciting way to grow wealth, and starting young gives you a powerful head start. Even small investments today can grow into something big tomorrow.
With support from a parent and a little curiosity, any teen can begin a smart investing journey – and build habits that last a lifetime.