What's the Minimum Age to Trade Stocks? A Complete Guide for Young Investors

Starting to trade stocks early gives you a significant advantage. The math is clear: when you begin trading and investing at a younger age, you benefit from decades of compound growth. Whether you’re a teen interested in trading stocks or a parent looking to help your child start trading, understanding age requirements and account options is essential. But the answer to “how old do you have to be to trade stocks” isn’t as straightforward as it seems—and that’s what we’re here to clarify.

Starting Young: Why Age Matters When You Trade Stocks

The younger you are when you begin to trade stocks, the better positioned you’ll be financially. There are two key reasons for this advantage.

First, time multiplies your returns. When you trade stocks consistently over decades, compounding works its magic. Here’s how: if you invest $1,000 at 4.0% annual growth, you’d have $1,040 after year one. In year two, you’re earning 4.0% on that $1,040, giving you $1,081.60. By year 30, that single $1,000 investment could grow to over $3,200. Multiply that by regular contributions throughout your teenage years and early twenties, and the difference becomes life-changing.

Second, starting young builds financial literacy. When you trade stocks as a teenager, you’re not just growing wealth—you’re learning valuable lessons about market behavior, company fundamentals, and risk management. These skills will serve you as an adult investor.

The Legal Age to Trade Stocks Independently

The short answer: You must be at least 18 years old to open and manage your own brokerage account. This means you can independently trade stocks, make all your own investment decisions, and control your account without any adult involvement.

However, being under 18 doesn’t mean you can’t start trading stocks. With parental help, minors can access several account types that allow them to trade and invest. The key is understanding which account structure gives you the freedom to make trading decisions versus letting parents manage trades on your behalf.

Account Types for Young Traders

If you’re under 18 and want to start trading stocks, you have three primary account options:

Joint Brokerage Accounts

The setup: A parent (or another trusted adult) and a minor both own the account and share decision-making power.

Who owns the investments? Both the minor and adult
Who decides what to trade? Both can make trading decisions
Minimum age: Typically no formal minimum, though individual brokers may set their own

This is the most flexible account structure for young traders. Either person can trade stocks, buy funds, or make investment decisions. You can also start with your parent making all trades when you’re younger, then gradually transition to you making more decisions as you mature.

Many brokers now offer joint accounts with youth-focused features. For example, Fidelity Youth™ Account is specifically designed for teens aged 13-17. You get access to trade stocks and ETFs with as little as $1, plus a free debit card with no fees. Your parent maintains visibility and can set up transaction alerts, while you build real trading experience.

Custodial Brokerage Accounts (UGMA/UTMA)

The setup: An adult opens and manages the account “in custody” for a minor. The minor legally owns the investments, but the adult controls trading decisions.

Who owns the investments? The minor
Who decides what to trade? The adult (custodian)
Minimum age: Typically no formal minimum

With custodial accounts, you own the stocks and funds inside, but your parent or guardian makes all trading decisions. These accounts offer some tax advantages—certain investment earnings are shielded from taxation each year, while additional earnings are taxed at your lower child tax rate rather than your parent’s rate.

There are two types of custodial accounts:

• UGMA (Uniform Gifts to Minors Act): Can hold financial assets like stocks, bonds, ETFs, and mutual funds. Available in all 50 states.
• UTMA (Uniform Transfers to Minors Act): Can hold financial assets plus physical property like real estate or vehicles. Available in 48 states (South Carolina and Vermont don’t recognize UTMA).

When you reach the age of majority (typically 18 or 21, depending on your state), you gain full control of the account and all the investments inside.

Custodial Roth IRAs

The setup: For minors with earned income (from a job, freelancing, or self-employment), a custodial Roth IRA lets you save for retirement while getting tax advantages.

Who owns the investments? The minor
Who decides what to trade? The adult (custodian)
Minimum age: Must have earned income; no other age minimum

Here’s the powerful part: if you’re 16 and earned $2,000 from summer work, you can contribute that $2,000 to a custodial Roth IRA and invest it in stocks, ETFs, or mutual funds. The money grows completely tax-free, and you won’t pay taxes when you withdraw it in retirement. For 2026, the contribution limit is $7,000 per year (or your total earned income, whichever is less).

At the age of majority, you’ll gain control of the account. By that time, decades of compounding may have already significantly grown your retirement nest egg.

Getting Started: How to Trade Stocks as a Young Investor

Step 1: Choose Your Account

Decide which account structure makes sense for you:

• Joint account if you want trading freedom with parental oversight
• Custodial account if your parent will manage trades and you’ll take over at 18
• Custodial Roth IRA if you have earned income and want tax-free retirement growth

Step 2: Pick Your Trading Platform

Different platforms offer different features for young traders. E*Trade’s IRA for Minors is popular for retirement investing and offers zero-commission stock and ETF trading. Acorns offers a simpler approach with its “Round-Ups” feature that automatically invests spare change into a diversified portfolio. Fidelity Youth™ provides education-focused tools and allows you to start with just $1 per trade.

Step 3: Learn and Start Small

Begin by trading with small amounts. Many platforms let you buy fractional shares, so you can start with $1, $5, or $10. Use this time to learn how different stocks and ETFs behave before committing larger amounts.

Best Investment Choices for Young Traders

When you’re young with decades ahead of you, you can focus on growth-oriented investments rather than playing it safe:

Individual Stocks

When you trade individual stocks, you’re buying a piece of ownership in a company. If the company performs well, your stock typically grows in value. The downside: if the company struggles, your stock can lose value quickly. Individual stock trading is engaging because you can research companies, follow news, and discuss your picks with friends.

Mutual Funds

A mutual fund pools money from many investors to buy dozens or even hundreds of stocks at once. Instead of putting all $1,000 into one stock and risking significant loss if that stock tanks, you spread $1,000 across many holdings. If one stock drops, it has a smaller impact on your overall portfolio. The tradeoff: mutual funds charge annual fees that come directly from your returns.

Exchange-Traded Funds (ETFs)

ETFs are similar to mutual funds but trade throughout the day like stocks (mutual funds only settle once daily). Most ETFs are passively managed, meaning they track an index rather than relying on human managers to pick stocks. Index funds tend to be cheaper than actively managed mutual funds and often outperform them. For young traders looking to gain broad exposure without high fees, index ETFs make excellent sense.

Why Trading Young Gives You a Massive Advantage

The Compounding Effect

Every dollar you trade and invest now has potentially 50+ years to grow. That’s the real magic of starting young when you trade stocks. Compound returns turn modest investments into substantial wealth over time.

Building Lifelong Financial Habits

When you trade stocks regularly as a teenager, you develop saving discipline that carries into adulthood. Once you’re grown, investing should become as routine as paying rent or utilities. Teenagers who start trading early rarely stop—they’ve already embedded investing into their identity.

Flexibility to Recover

The stock market cycles up and down. If you start trading when you’re 15 and the market drops 30% when you’re 20, you have 45+ years to recover. That’s a luxury older investors don’t have. Young traders can wait out downturns and come out ahead.

Parent-Only Investment Accounts

If you’re a parent wanting to save for your child before they’re old enough to trade independently, you have additional options:

529 Education Savings Plans

These tax-advantaged accounts let you save for qualified education expenses (tuition, room and board, books, student loans, K-12 expenses, and trade school). Money grows tax-free as long as it’s used for education. Any non-qualified withdrawals are taxed and incur a 10% penalty, though some exceptions exist (military academy attendance, disability, scholarships).

Coverdell Education Savings Accounts (ESA)

Similar to 529 plans but with lower maximum contributions ($2,000 per year per student) and specific income limits. Funds must be used for qualified educational expenses before the beneficiary turns 30.

Standard Parent Brokerage Account

You can always use your own brokerage account to invest for your children, with complete flexibility. There are no contribution limits and no restrictions on how you use the funds. The tradeoff: no tax advantages like those offered by 529 or ESA accounts.

The Bottom Line: Age Requirements for Trading Stocks

To independently trade stocks without adult oversight, you must be at least 18 years old. Before 18, you’ll need a parent or guardian to either co-own the account (joint brokerage) or maintain custody of it.

However, age doesn’t have to be a barrier to starting young. Through joint brokerage accounts, custodial accounts, and custodial IRAs, minors can begin trading stocks, learning market fundamentals, and building wealth. The earlier you start to trade stocks and invest consistently, the more time compounding has to work in your favor. Whether you’re 13 or 17, opening an account and making your first trades today positions you for financial success decades down the line.