10 Best Stock Apps and Investing Tips for Teens
These days, teens are getting a first-hand financial education as many of them have begun stock market trading and investing. While it’s good to start young, teen investing can come with risks that your child should understand.
Many teens don’t fully grasp the risks of stock trading and lose more than their spare change as a result!
As a parent, there are things you can do to help your teenager get on the path to financial success. We have some tips to help your teen start investing as well as a list of 10 of the best investing apps and stock apps.
As you help your child have a better understanding of the stock market, you may pick up some useful tips in the process to help with your own investment goals.
Related: 14 Credit Card Tips for Teens
How to Help Your Teen Start Investing
If your teen has come to you and has an interest in starting to invest some of their money, here are some ways to help them get on the right path.
Educate Them About the Basics
Call it a crash course in stock market trading 101 if you will. Begin by telling them how the stock market works. Explain how to buy stocks and how they can make and lose money. If you’re unsure how exactly to explain how investing in the stock market works yourself, do some research with them online or ask someone who has deeper knowledge. A trip to the bank to speak with a professional is also a good way to start.
Why does your child want to invest? What are his or her financial goals? Having a clear mindset of what the end game is will help you guide your child on the right path and find the right investment strategy.
Open a Brokerage Account
While minors cannot open a brokerage account by themselves, you can work with them to open a joint or custodial account that will help them to invest.
Choose Investments Wisely
With so many options available, choosing the right investments can be overwhelming. This is where you may want to lean on professionals to help your teen choose the investments that will give them the best chance of reaching their goals.
It may also be a good idea to teach them the benefits of a “buy and hold” strategy. Many investors buy quality stocks and hold them for years to see a solid return. Since markets go up and down unpredictably, teens should be taught early that sometimes they have to ride the wave to see a real money return.
Risks of Teen Stock Trading
As with stock trading for adults, teens also face risks by putting their money in the stock market. The problem is that teens may not fully understand the risks involved. Understanding that this is real money, and not play money, is key.
When it comes to financial literacy and understanding the risks of stock trading, it’s important to explain to them that stocks are risky because you are bidding on an investment with no guaranteed results. They may buy a stock that is in a good position one day and then falter the next.
Stock movements can appear random and difficult for teens to understand. If they’re not willing to take risks, they may not be quite ready for stock trading.
If your child is ready to take the risk, thoroughly discuss all of the trades your child wants to make. To avoid potential disasters, you may also want to set rules that you are the only one who can submit requests to buy or sell stocks. One wrong click can end in catastrophe!
In some cases, teens can use these investing apps and stock trading apps to watch how their investments are performing and even receive notifications, but you’ll be doing all of the heavy lifting when it comes to buying and selling stocks.
10 Best Investing Apps and Stock Apps for Teens
1. Fidelity Youth Account
Fidelity Youth Account is a brokerage account for teens ages 13-17. There are no account fees, no account minimum, and no trading commissions.
Teens can trade most U.S. stocks, exchange-traded funds (ETFs), and Fidelity mutual funds. The account also comes with a free debit card to help teens manage their money.
There are parental controls attached to the account since a parent or guardian must have or open a brokerage account with Fidelity to open a Fidelity Youth Account. Parents can have online account access, look at monthly statements and trade confirmations, and view debit transactions. You can also get alerts on account activity.
Stockpile is another option for your teen to use for investing by using a custodial account. The app allows kids to choose which stocks to buy and sell with parental approval. Teens get a separate login from their parents where they can look at thousands of popular stocks and ETFs to build their portfolios.
Once they request the trade, a parent needs to approve. There are no trading fees or commissions. There is also a cool option to offer gift cards for stock.
3. Ally Invest
Ally Invest’s custodial account is an option for beginners and teens who may not be quite ready to invest but want to learn more. Some features include helping teens build their investment portfolios, earn dividends, and work toward long-term financial goals.
The setup process is a little tedious and not as straightforward as some of the other apps. Also, if your teen wants more of a hands-on approach, you may want to try one of the other options. It all depends on what you and your teen want out of your investment app.
Greenlight is a favorite when it comes to investment apps. It is an investment account that comes with a debit card and bank account. The investing app teaches the basics of investing to beginners, covering topics like how to invest in stocks and ETFs.
Greenlight requires linked accounts from an adult’s bank or brokerage. Parents also need to approve any trades in the investment account. There are no trading commissions beyond the monthly subscription fee.
With the app, teens only have U.S. listed stocks and ETFs have investment options that either have a market capitalization of over $1 billion or a three-month average daily dollar volume of more than $500,000.
UNest is more of an app for parents to use for investing in their child’s future. But it can be a great investment app because it allows parents to invest money under their children’s names through a custodial account.
If you wanted your teen to get involved, you could have them use the app with you. While they would have no control over the finances, they could get an overview of how these types of apps work.
Account holders can receive bonuses for their children’s accounts from partner offers from companies like Levi’s, Disney, and more.
There is also an UNest Investment Account for Kids that allows parents to set up and manage savings and investment plans for their children. UNest also has options to invest in digital assets like Bitcoin and Ethereum.
Although you have to be 18 years or older to open an investment account, teens can use Vanguard through a custodial account. Teens can invest and learn how the process works.
Through a Vanguard custodial account, teens can take advantage of a wide variety of investment options, including Vanguard mutual funds, stocks, bonds, non-Vanguard mutual funds, and ETFs.
If your teen is looking for help to save money that they want to use for investments, Oportun, formerly known as Digit, could be an option. Oportun is a financial app that helps you spend, budget, invest, and save through automation.
The app analyzes any money coming in, as well as recent spending and other factors to determine how much money can be saved and invested. Money can then be transferred into a savings account.
This app requires quite a bit of parental involvement, but it can be a good tool for budgeting and seeing the best way to use saved money. There is a minimal fee to use the program.
8. Stash Invest
Stash is a good choice if you’re looking for more than an investing app for your teen. Stash offers other services for personal finance such as money management.
Stash offers thousands of individual stocks and ETFs to choose from. When you sign up for the plan, it will ask a series of questions to determine investment preferences, risk profile, and financial goals.
Based on your answers, Stash will make investment preferences for you. As money is added to the Stash account, the money can be used to purchase fractional shares of companies. For example, your teen can invest as little as $1 in companies like Google or Apple and see where it goes.
As a parent, you can also take advantage of the custodial investing accounts available through the Stash+ plan. When your child turns 18 years old, they can use the money in their Stash account balance for education or other opportunities. There are small low-cost fees associated with the Stash accounts.
Webull is a new app to the scene, as it launched in 2018. This is a good app for beginners, like teens, who want to learn about risk tolerance and the stock market. It’s free to download and there are no stock/ETF trade commissions through the mobile app or desktop site.
There are no custodial accounts, so Webull is reserved for 18 and 19-year-olds in the teen scene. But it is one of the best investing apps to help teens make their own investment decisions and learn about building wealth.
Finally, there is Bloom. Bloom is an investing app that offers custodial accounts, no account minimum balances, and no commissions or fees. Bloom aims to help teens understand the stock market and investing. There are more than 60 modules designed like Instagram stories to teach your teen about cryptocurrencies, risk tolerance, budgeting, UGMA accounts, and more.
Bloom uses Plaid and SIPC Insurance to keep your teen’s money safe. So, they’ll even learn about this aspect of investing and having an account! This free stock and investing app are a good option for teens who want to learn about investing.
Bloom rates all the stocks, so teens can learn how some stocks are more volatile while others are low risk. Teens have the opportunity to invest in companies they have heard of, as well as ones, they may not be familiar with. This allows them to have a variety of stocks to choose from.
The Bottom Line
When it comes to the best stock apps for teens, it’s important to take an active role. While you certainly want them to learn, you still want there to be parental controls to help in the process. Apps and programs that offer free trading and no fees are optimal.
You also want to look for ones that offer teaching tools and offer guidance, especially if you don’t have much experience with the stock market. In the end, both you and your teen can get a valuable lesson in investing when you’re done!
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