20% of Teens Have Started Investing. Here's How to Find a Great First Brokerage Account

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Get ready to put your money to work.

Key points

  • A recent survey reveals that one in five teenagers already invest their money.
  • Choosing the right brokerage account could be your ticket to starting your investing career.

It’s a big myth that investing is something only the wealthy or established should dabble in. The reality is that the sooner you start investing money you aren’t using immediately, the more wealth you have the potential to grow.

In fact, if you’re still in your teens and holding down a job, you may want to consider investing some of your earnings. If you do, you’ll be in good company. That’s because 20% of teens have already begun investing, according to a recent Fidelity survey.

Now if you’re looking to invest, you’ll need to find the right brokerage account for your money. And the tough thing is that there are many to choose from. But here are some specific features you may want to look for when weighing your options.

1. No fee stock trading

You might pay a fee to buy shares of a mutual fund or exchange-traded fund (ETF) in your brokerage account. But you shouldn’t have to pay a fee each time you buy or sell shares of individual stocks. Most big-name brokerages (and even lesser-known ones) have done away with that practice, which can eat away at your returns. So don’t sign up for needless fees that could make it harder to grow your money.

2. No account minimums

If you’re a teen, you may not have the same amount of money to invest as someone in their 20s or 30s with a full-time job. And the last thing you want is for that to be an issue. That’s why it’s important to find a brokerage account that doesn’t have a minimum balance requirement. If you can only allocate $100 for stock-buying purposes initially, so be it.

3. The option to buy fractional shares

Along the lines of having limited money to invest, you may find that certain stocks are out of reach financially — that is, if you’re looking to buy full shares. But many brokerage accounts don’t make you do that. Instead, a growing number of brokerages allow investors to purchase shares of stock on a fractional basis. That means that if a given company’s stock is trading at $1,000 per share and you only have $250 to work with, you can buy a quarter share.

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Fractional investing gives you more buying flexibility. Plus, it makes it easier to build a diversified portfolio on a budget.

4. Educational resources

Your knowledge of investing may be limited if you’re only in your teens — and that’s okay. But what you should do is find a brokerage account that has the tools and resources you need to learn more. Most big-name brokerage accounts have plenty of information that beginners can access, so finding one with this feature shouldn’t be hard.

Investing in your teens really puts you ahead of the game on the road to building wealth. That’s because many people don’t start investing until much later in life. But if you’re going to invest, make sure to find the right home for your money. And if you don’t end up liking the first brokerage account you decide to use, switch brokerages. The happier you are with your brokerage account, the more motivated you might be to keep investing.

READ MORE: This Was My Smartest Investing Move