How to Start Investing as a Teenager

Investing during teenage years builds valuable habits, makes the most out of compound interest, and has tax advantages. In general, the earlier you start investing, the better. 

If you are a minor, you can start investing, but it needs to be done with a custodial account. These are financial accounts an adult maintains for a child or another person under the age of majority. 

How to Start Investing as a Teenager

Index funds, like VTI or VTSAX, that track the total stock market, or a broad section of it, provide diversification. By diversifying your investments, this decreases the level of risk in your portfolio.

What Should a Teenager Invest Money In?

This is enough money to buy a few shares of many popular index funds or individual stocks. If you choose to focus on investing in growth stocks, create a portfolio with a few shares of several of your favorite stocks, rather than spending it all on one stock.

What Should I Invest $1,000 In?

To invest as a minor, you will need a trusted adult to set up an UGMA account, such as Acorns Early, or an UTMA account. The money in these custodial accounts belongs to you, but the adult will oversee any trades you want to do. 

How Can I Invest at 14?

Roth IRAs are usually the better to start with because you pay taxes on contributed money right away when your income is lower. With a traditional IRA, you pay when you withdraw money.

Best Investment Plan: Start a Roth IRA

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