Asset management behemoth Fidelity is launching a brokerage account for 13-to 17-year- olds, enabling them to save, trade and invest with zero commission.
The Fidelity Youth Account is the industry’s first brokerage account of its sort, according to the company. Parents and guardians can monitor the teen’s activity in the account, “fostering new learning opportunities and topics for discussion,” according to a statement.
The account combines a new library of tailored educational content and tools, as well as a brokerage platform mobile app and customer-centric practices such as zero subscription fees, zero account fees, zero minimum balances, zero domestic ATM fees and zero online commissions.
“Fidelity is committed to responsibly supporting young investors,” Jennifer Samalis, senior vice president of acquisition and loyalty at Fidelity Investments, said in the statement. “Importantly, our goal for the Fidelity Youth Account is to encourage young Americans to learn through action and foster meaningful family conversations around financial topics. Designed alongside teens and parents, the account is charting a new course by providing the ability for teens to build healthy money habits through learning by doing.”
In addition to saving, teens will be able to trade domestic stocks, most ETFs and Fidelity mutual funds.
When the person reaches 18, the account changes to a standard brokerage account.
Fidelity is taking advantage of one of the most striking phenomena of 2020, the fact that retail investors became more savvy and more self-educated during the pandemic. The slew of constant enormous events triggered a once-in-a-lifetime investing opportunity that changed the retail trading landscape, encouraging investors to take control of their finances and giving them a sense of ownership for their future and retirement. It gave rise to a new generation of retail investors who do the research and self-educate.
According to a Fidelity survey, nearly three in four teens (73%) are now more confident in achieving financial success.
The Wall Street Journal reports that in the first three months of 2021, Fidelity added 1.6 million accounts from investors 35 years old or younger — more than triple the number of new accounts from that demographic a year earlier.
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