Are you a teenager looking to invest but don’t know how? Investing as a teenager can be an exciting way to grow your wealth and gain financial literacy skills. Also, it’s a great way to start preparing for your future and develop a long-term mindset. At the end of the article, I will introduce you to one way to invest as a teen that most are unaware of.

What can I invest in?

When most people think about investing, they think about stocks. Firstly, we have to answer what a stock is. Stock is simply a piece of a company. When you buy Apple stock, you are betting that Apple will eventually pay back money to you through something called a “dividend” (fancy jargon to say sharing profits with people who buy the stock, a.k.a. the shareholders) or that they will be bought out by another entity, such as when Twitter was bought out by Elon Musk, and money was paid to the shareholders. 

Nevertheless, you can invest in various other products like CDs, real estate, and bonds, which we won’t have enough time to go into in depth. But there is no need to get fancy; investing in an exchange-traded fund or ETF can be enough for someone who is new to the field. They are a great option to dip your toes in the world of investing by buying stocks of multiple companies at the same time. For instance, VOO is made up of 500 different big companies, including Apple, Microsoft, and Amazon. Instead of buying Apple stock, Microsoft Stock, and Amazon stock individually, you can just buy VOO, which contains all these stocks.  

How can a teenager invest?

Now, you may ask, how can I buy an ETF? I have worked for Bumper Investing, a fin-tech startup that allows teenagers to invest. However, they are now bankrupt and have refunded all the investment amount to the account owners. Fortunately for you, there is another more reputable company called Fidelity. 

Fidelity’s Youth Investment Account is one of the only youth investment accounts out there with strong credibility and benefits: 

• Users can buy and sell most U.S. stocks, ETFs, and Fidelity mutual funds.
• Zero account fees and zero commissions for online trading.
• No minimum investment requirements.
• Access to your own debit card with no domestic ATM fees.
• $50 reward for downloading the Fidelity mobile app and activating the Youth Account.
• No monthly fees or account minimums.
• Ability to invest in stocks for as little as $1 with fractional shares.
• Financial curriculum that lets teens earn cash rewards for learning and taking financial lessons.

For more information check out: Fidelity Youth Account | Save, Invest, & Spend | Fidelity Investments

After recently downloading it, it was no wonder why the startup I worked at failed. With no bonuses and without an established reputation of 75 years, it was doomed for bankruptcy. Other investment accounts face the same fate. For instance, Bloom, another investing app designed for teens, charges $120 per year. Would you rather pay $120 every year to invest or get paid $50 to invest (sign-up bonus for Fidelity)? 

For more advice like this, please join the Biznet Fintalk Club at FDRHS in room 404, on Fridays from 2:40 to 3:30.

Please note that this is not a substitute for financial advice. You should seek a financial advisor or adult before making any financial decisions!