Investing Apps for Teens

Revised: July 12, 2023

by Emmanuel Modu, Author of TeenVestor: The Practical Investment Guide for Teens and Their Parents

One of the first investment decisions you and your parents will have to make, after you decide on companies in which to invest, is what apps to use. Your parents must be involved in this decision, because they will have to fill out the custodial account application you need before you can buy stocks, mutual funds, or ETFs through an online broker that offers the appropriate trading app. They can also help you understand the pros and cons of going with specific brokers.

If your parents already use a broker, it is possible they would want to establish a custodial account with that broker. Our suggestions in this section is to tell you what to consider when choosing an online broker (with your parents' assistance) that has an app that is right for teen investors.

Top 10 Online Brokers Offering Investment Apps for Teens

Overall, the best custodial brokerage accounts for minors are listed below. These online broker offer investment apps that are appropriate for young investors. We explain our criteria after the list.

All online brokers have a list of their trading prices and service rates on their websites. You should look them over very carefully before deciding which broker to use.

Online brokers 1 through 5 are more of the traditional brokers, most of which have been in existence for decades.

Online brokers 6 through 10 are newer online brokers who were created to help teen investors or young adults interested in savings and investing.

Please note that Robinhood is not on this list because the company does not currently offer custodial accounts.

How We Rank the Teen-Friendly Investing Apps

Online investing apps offer investors a lot on their websites to entice them to sign up. They even add some educational and research material just to get you to become informed enough about the stock market so that you are comfortable buying shares through them.

However, we take a simplified approach to determining which investing app is best for teen investors. We just want to know the following:

What is the minimum required balance?
How much does it cost to trade stocks?
Does the app allow you to buy fractional shares?
Is there a monthly subscription cost?
Are there other hidden costs?

Minimum Balances

Of course, most teen investors are short on cash, so they need online brokers that require little or no minimum balance in a trading account to begin buying stocks. These days, some of the biggest online brokers that you see being advertised on television have eliminated minimum balances due to increased competition. Nevertheless, you should always check to see if the online broker you choose has no minimum balance and if it charges any kind of monthly service for keeping very low investment balances while using their trading apps.

Currently, nearly all the companies on our top ten list have a minimum account balance of $0 as you open a trading account with their apps.

Trading Cost

When deciding on which online broker to use, the cost to buy and sell stocks and ETFs with its app is an important consideration.

Due to intense competition online brokers, trading costs have come down dramatically. One company, Robinhood, is one of the companies that forced some of the traditional brokers with an online presence to reduce or eliminate brokerage fees. Right out the gate, Robinhood offered brokerage service to help investors buy and sell stocks without paying a dime in commission and without a minimum balance – all through their mobile app.

Currently, nearly all the companies on our top ten list charge $0 for stock trading but some of them may have subscription fees which is described later on this blog. .

Fractional Shares

Some stocks are so expensive (with some in the hundreds to thousands of dollars per share) that they are out of the reach of an investor with little cash. One solution offered by brokers is to allow investors to buy a fraction of a share.

It is not surprising that Robinhood and some of the other newer online brokers offer this option to investors. However more traditional brokers with an online presence such as Fidelity and Charles Schwab have also entered the fray.

We believe that this type of offering to investors increases the teen-investor-friendliness of some online brokers.

Currently, all the companies on our top ten list above allow you to buy fractional shares with their apps.

Watch Out for Subscription Fees

Some online brokers may charge a hefty monthly subscription plan that we feel young investors should generally avoid. These type of fees can cut deeply into the investment returns of teen investors who have very little to invest in the first place. Companies like Greenlight, Stash, and Acorns, which are on our list, monthly charge a monthly fee for their investment services.

However the apps offered by these online brokers may be good for some young investors who need more handholding in their investment journey. Some of these types of online brokers also offer banking services for teens so they may be appropriate for some young investors.

Hidden Costs

While a low minimum balance for opening a trading account and a low trading cost are desirable, Teenvestors have to watch out for hidden costs of other services for which they may be charged.

The most common thing for some not-so-reputable brokers to do is to charge low commissions but add some handling charges to the commission.

In addition, costs for buying and selling mutual funds may be considerably higher than for buying and selling stocks or ETFs, so you should consider what type of financial transactions are most likely for you.