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Parents Give Teens The Gift Of Investing
Investing brings the whole family together // Illustration by Kate Walker
Parents are opening joint brokerage accounts with their kids to give them investment knowledge from an early age.
Why It Hits: Day trading, long-term investing, and public markets have sparked the interest of everyday people in recent years, especially as digital platforms have made it easier to get involved. As a generation of millennials approaches middle age without the assets it expected to have, it wants to ensure that its kids don’t suffer the same fate… especially as the economy transforms under their feet.
Behind The Investment: Forget a cash allowance when you can have a stock portfolio, according to Bloomberg.
Firms like Charles Schwab, Acorns Grow, and Greenlight Financial have rolled out teen-focused accounts that require — and promote — parental supervision.
Parents can approve trades, issue debit cards, and set gamified goals or lessons to motivate kids to complete chores in exchange for funds.
The apps also include educational materials that teach kids investment fundamentals — a financial literacy course that turns money into a learning tool.
Closing Balance: The best investing happens by leveraging time, which is why a Schwab survey found that 73% of parents said it was “very important” for teens to learn about it.
But what’s more surprising is that a lot of teens already understand the importance of investing, with that same Schwab survey finding that 59% were “aware” of the practice before turning 13. That’s a huge difference from their parents — only 6% could say the same.
Maybe the kids really are alright.
Next Holiday: With teens reportedly showing a preference for blue-chip company stocks, some Fortune 500 companies may start gearing their marketing toward Gen Alpha.
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Today’s email was written by David Vendrell.
Edited by Nick Comney. Polled and Copy-edited by Kait Cunniff.
Published by Darline Salazar.