LOS ANGELES (CBSLA) – Fidelity Investments is joining a growing list of investment groups allowing teens to trade stocks.
The brokerage giant says the Fidelity Youth Account is aimed at getting teens involved in saving, spending, and investing. 13-to-17-year-olds can trade most U.S. stocks, exchange-traded funds (ETFs) and Fidelity own mutual funds through Fidelity’s mobile app.READ MORE: Thomas Apollo Of Poway Charged With Attacking Workers At Tustin Vaccine Clinic, Groping Nurse Trying To Treat Him
“I think Fidelity made this move and is realizing that there are other companies out there like Robinhood, which have made a major market dent in the teen market and the twenties market right now,” according to certified financial planner Ted Jenkin, CEO at Atlanta-based oXYGen Financial.
Fidelity says the new account will have no fee or minimums and comes with a free debit card. A parent must also have a Fidelity account.
Fidelity has announced that it is setting up a new Fidelity Youth Account plan for 13- to 17-year olds. The teens' parents must already have Fidelity accounts and will have full access to monitor their kids' spending and investing activity. https://t.co/JZY8T8Om7H
— CNN (@CNN) May 18, 2021
Parents will have access to their kids spending and investment activity but parental approval is not required to make transactions. And once teen investors turn 18, the youth account automatically transitions into a standard one.READ MORE: Vigil Held For ‘Dedicated, Outstanding, Compassionate’ Nurse Killed In Bus Stop Attack Near Union Station
The move comes as Congress scrutinizes investment apps and their business model. Fidelity’s rival, Robinhood, has come under scrutiny for allowing risky behavior among some individual investors following the rise of meme stocks like GameStop and AMC.
“They look at Reddit boards or they’re following trends on social media and buying and selling stocks every day. And that’s not really investing. It’s really more gambling,” Jenkin says.
Experts say Fidelity should work to educate clients to prevent them from making reckless choices with their money.MORE NEWS: Biden Administration To Give Out 400 Million Free N95 Masks
“We want to make sure that people are learning about investing, that they’re investing responsibly and that they’re truly building wealth for themselves and for their family,” says Jully-Alma Taveras, founder of Investing Latina.