Charles Schwab is offering teenagers a unique opportunity to gain real-world investing experience with the launch of their Teen Investor Account. This joint brokerage account allows teens between the ages of 13 and 17 to open an account with a parent and start investing.
While Schwab is not the first to offer investment accounts for teens, their account differs in that it is a joint account with parents, who will have full access to help manage it. The Fidelity Youth Account, launched in 2021, also allows teens to start investing while their parents monitor account activity.
A recent survey conducted by Schwab revealed that 70% of teens are very or extremely interested in investing. This aligns with Fidelity’s Teens and Money Study from 2023, which found that 75% of teens believe investing is important, even though only 23% have already started investing.
Jonathan Craig, head of investor services at Charles Schwab, emphasized the importance of helping young investors build good habits and make informed decisions. The Teen Investor Account aims to set teens up for a lifetime of financial success.
The Teen Investor Account offers a variety of educational resources to help teens learn about investing. Upon signing up for the account, teens can take Schwab’s Quick Start to Stock Investing course and receive $50 invested across the top five stocks in the S&P 500. This serves as a monetary incentive to encourage learning.
In addition to the initial course, teens will have access to an education series focusing on personal finance essentials, investing 101, how to invest in stocks, and how to trade at Schwab. They can continue learning through Schwab’s education hub, which includes videos and articles for investing beginners.
Parents are encouraged to get involved in their teens’ investing journeys, as shown by a recent Schwab survey where 91% of parents expressed a desire to help their kids invest. The Teen Investor Account allows parents full visibility into account activity and the ability to add or withdraw funds.
Teens have a range of investment options to choose from, including ETFs, mutual funds, fixed-income products, and fractional shares. While some investment types are restricted, such as margin trading and options trading, teens can invest in exchange-traded products tied to cryptocurrency prices.
As teens reach adulthood, they have the option to continue using the account or transfer their assets to a regular individual brokerage account. Parents and teens can decide whether to keep the account open longer or open a new joint brokerage account.
Overall, Schwab’s Teen Investor Account provides a valuable opportunity for teens to learn about investing with the guidance of their parents. It is just one of many options available for teens to start building good money habits and preparing for their financial futures.
