I never invested a dime until I was 25, when I enrolled in a 401(k) plan for the first time.

Today’s teens are way ahead.

According to recent data from Charles Schwab, 7 in 10 teenagers ages 13-17 say they’re very or extremely interested in investing. And their parents are all in — nearly three-quarters of parents say it’s very important for teens to learn about investing. (Disclosure from Schwab: These are parents with an average age of 45 and a median of $375,000 investable assets.)

“Teens are growing up in an environment where investing information is everywhere, but it’s not always trustworthy,” Michaela Jesionowski, managing director at Charles Schwab, told me.

“There’s a lot of messaging out there that focuses on ‘get rich quick’ approaches instead of long-term outcomes — and we’ve also seen the blurring of the lines between investing and gambling. That’s why it’s so important to ground young people in investing fundamentals that support their short-and long-term goals.”

The moment is ripe, given that only 14% say they know a lot about investing. And they are worried about losing money because of a bad investment, not knowing what to do when investing, and feeling stressed about how their investments perform.

More skill than luck

Half of the teenagers surveyed believe investing requires more skill than luck to make money, although roughly the same number say investing is a good way to have fun.

“From day one on that first summer job, saving and investing must become a habit,” said Gene Natali, founder of Troutwood, a financial planning platform. “In a world without pensions, we as individuals are fully responsible for our financial future. This is no longer nice-to-have knowledge — it’s a must-have.”

The earlier, the better. “To me, the biggest advantage is simply time. A teenager who understands compounding and long-term investing habits at 15 or 16 is way ahead of where many adults started,” said Mark Johnson, an investments and portfolio management fellow at Wake Forest University.

But of course, guardrails matter, he added. “Social media has made investing more accessible, but it has also made speculation and ‘get rich quick’ thinking much more common,” Johnson said.

His advice: “Parents should frame investing as long-term wealth building rather than entertainment. Proper investing should honestly be pretty boring. Starting with diversified ETFs and helping teens understand that occasional paper losses are just part of investing.”

Sheila Bair, former chair of the Federal Deposit Insurance Corporation (FDIC) and author of the new book, “How Not to Lose a Million Dollars: A Young Person’s Guide to Avoiding the Tricks and Traps of Our Financial System,” agreed.

“They need to learn how to hold on to their money and spend it wisely and save and invest it wisely, “ she told Yahoo Finance. “For beginners, it’s index investing. It really is the best way. When they get older, they can start picking individual stocks.”

One way to give kids real-world experience is to allow them to give it a whirl.

Schwab recently began offering the Schwab Teen Investor account, which lets teens own a joint brokerage account with their parents and invest directly in individual stocks and exchange-traded funds, among other investments.

The parent must initiate and approve opening the account. They can review all transactions, statements, trade confirmations, and account activity and can close the account at any time. When the teenager reaches 18, the assets can be transferred to a new account.

Fidelity Investments has a similar product, Fidelity Youth, aimed at teenagers aged 13 to 17.

A parent opens the Fidelity account on behalf of their teen, but the account is owned by the minor who makes the investment decisions. Like the Schwab account, parents have full access to review what’s afoot. This is different from a UGMA or UTMA account, where the custodian makes the investment decisions on behalf of the minor.

Teens are restricted from investing in certain higher-risk or more complex investments, such as options or margin trading, and a parent can shut these accounts down at any time. Fidelity Youth accounts must be converted into standard Fidelity brokerage accounts when teens turn 18.

Have a question about retirement? Personal finances? Anything career-related? Click here to drop Kerry Hannon a note.

Biggest risk isn’t TikTok influencers

The biggest risk for teen investors right now isn’t TikTok influencers, said Matt Chancey, a certified financial planner. “It’s that they’re being introduced to investing through the most exciting parts of the market — meme stocks, crypto, AI plays, options — as their entry point. That’s backwards. The first investing lesson a teen should learn is that wealth gets built by the boring stuff over decades, not the thrilling stuff over weeks.”

If the parents’ goal is to teach long-term wealth building, start with index funds and a Roth IRA, not a brokerage account with $500 to play with, Chancey said.

“The first investing lesson a teen learns becomes the default lens they bring to money decisions for decades. Get that lesson right, and the rest follows.”

Kerry Hannon is a Senior Columnist at Yahoo Finance. She is a career and retirement strategist and the author of 14 books, including the forthcoming “Retirement Bites: A Gen X Guide to Securing Your Financial Future,” “In Control at 50+: How to Succeed in the New World of Work,” and “Never Too Old to Get Rich.” Follow her on Bluesky.

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