Investing Tips for Teens: How to Start Building Wealth (2026)
The best time to start investing is when you’re young, and if you’re reading this as a teenager, you have an advantage that most adults wish they could get back: time. Thanks to compound interest, money invested at 16 grows dramatically more than the same money invested at 25. The teens who understand this early and act on it end up decades ahead.
The key investing tips for teens are: start as early as possible, use compound interest to your advantage, open a TFSA the moment you turn 18, start with low-cost index funds or ETFs, invest consistently in small amounts, and understand the difference between risk you can handle and risk you can’t.
This guide covers everything you need to know to get started as a teen investor in Canada, even if you’re under 18 and don’t have much money to work with yet.
This article is for educational purposes and is not financial advice. Always talk to a parent or financial advisor before making investment decisions.
Why Teens Have the Biggest Investing Advantage of All
Time is the single biggest investing advantage a teen has, and compound interest is what makes time so powerful. Compound interest means your money earns returns, and then those returns start earning returns of their own. The longer this cycle runs, the more dramatic the growth becomes.
Here’s what that looks like in practice. If you invest $100 per month starting at age 16 and earn an average annual return of 7% (roughly the long-run average of a broad stock market index), by age 65 you’d have around $345,000. Wait until you’re 25 to start the same habit, and you’d end up with about $190,000. Starting nine years earlier more than doubles your result, using the exact same monthly contribution.
That’s not a motivational speech. It’s math. Our guide to compound interest explains exactly how this works and why even small amounts invested early add up to something significant.
How Can Teens Under 18 Start Investing in Canada?
Teens under 18 cannot open a brokerage account on their own in Canada, but there is a clear path forward with parental help. A parent or guardian can open an in-trust account on your behalf. You don’t legally own the money until you reach the age of majority (18 in most provinces, 19 in BC, Nova Scotia, New Brunswick, and Newfoundland), but the investments are meant for you and grow in your name.
This isn’t a workaround. It’s a widely used and legitimate approach. Wealthsimple, one of Canada’s most popular investing platforms, explicitly recommends in-trust accounts for teens who want to get started before they turn 18.
Talk to your parents about this. If they’re willing to open an account together, you can start building real investment experience and real money before you’re legally old enough to do it on your own. And when the account transfers to you at the age of majority, you’ll already have a head start.
The Best Investment Accounts for Teens in Canada
Once you turn 18, you can open your own investment accounts. These are the most important ones to know about.
Tax-Free Savings Account (TFSA). A TFSA is likely the best account for most young Canadians. Any investment growth inside a TFSA is completely tax-free, which means you keep every dollar your investments earn. The 2026 annual contribution limit is $7,000, and unused contribution room carries forward. The Canada Revenue Agency sets these limits annually. For a deeper comparison of how TFSAs stack up against RRSPs, our article on TFSA vs RRSP benefits covers the key differences in detail.
High-Interest Savings Account (HISA). A HISA pays a meaningfully higher interest rate than a regular chequing account. As of 2026, competitive HISAs in Canada are offering rates around 3–4%. This isn’t investing in the traditional sense, but it’s a smart place to keep money you might need within the next year or two. You won’t risk losing it, and it still earns more than letting it sit in a basic account.
First Home Savings Account (FHSA). If you’re planning to buy a home one day, the FHSA is worth knowing about. Contributions are tax-deductible (like an RRSP), and withdrawals for a qualifying first home purchase are completely tax-free (like a TFSA). You must be at least 18 to open one, and it’s one of the best deals in Canadian personal finance for anyone who hasn’t owned a home before.
What Should Teens Actually Invest In?
Index funds and ETFs are the best starting point for most teen investors. An index fund tracks a market index (like the S&P 500 or a broad Canadian market index), which means instead of betting on one company, you automatically own a tiny slice of hundreds of companies at once. This built-in diversification dramatically reduces your risk compared to picking individual stocks, and the costs are very low.
ETFs (Exchange-Traded Funds) work similarly to index funds but trade on a stock exchange like individual stocks, making them easy to buy through any brokerage. Popular Canadian options include Vanguard’s VEQT (a one-fund global equity portfolio) and VFV (which tracks the S&P 500 in CAD). Both carry very low annual fees, typically below 0.25%, and have decades of data behind them showing consistent long-term growth.
Stocks are shares of ownership in a specific company. When the company does well, the stock price rises and you profit. When it struggles, so does your investment. Stocks carry more risk than index funds because your money is tied to one company’s performance, but they can also offer higher returns. If you want to invest in individual stocks, research thoroughly and only use money you can afford to leave untouched for several years.
GICs (Guaranteed Investment Certificates) are a lower-risk option. You deposit money with a bank or credit union for a fixed term (usually 1 to 5 years) and earn a guaranteed interest rate in return. In Canada, competitive 1-year GIC rates in 2026 are in the 3.5–4.5% range. You won’t earn returns like a stock index, but you also won’t lose money. GICs make sense for money you know you’ll need within a specific timeframe.
For most teens, the smartest starting strategy is to put the majority of available money into a broad index ETF and use a HISA or GIC for anything you might need within the next couple of years.
How Much Money Do Teens Need to Start Investing?
You don’t need much. Many platforms now offer fractional shares, which means you can invest in almost any stock or ETF with as little as $1. More practically, starting with $25 to $100 per month is enough to build real habits and let compound interest start working.
The bigger question is where the money comes from. Part-time work, summer jobs, tutoring, or flipping things you no longer need are all solid sources. Even a basic side hustle that earns an extra $100–200 a month gives you meaningful investing capital as a teen. If you’re still working on building your savings first, our guide on how to save money in high school covers the basics.
Dollar-cost averaging is a strategy worth adopting right away. Instead of investing a lump sum all at once, you invest a fixed amount on a regular schedule, like $50 every two weeks. This smooths out the impact of market swings: you buy more shares when prices are low and fewer when prices are high. It also removes the temptation to “time the market,” which is something even professional investors consistently fail at.
For guidance on how much to set aside before you start investing, our article on how much a teenager should save covers realistic targets based on your income level.
Where Can Canadian Teens Invest? (Wealthsimple vs Questrade)
For most Canadian teen investors, two platforms stand out as the best places to start.
Wealthsimple is the most beginner-friendly option. There are no minimum balances, no trading commissions on stocks and ETFs, and the app is clean and easy to follow. If you’re under 18, a parent can open a trust account through Wealthsimple on your behalf. Once you turn 18, you can open your own TFSA or investment account directly.
Questrade is another strong option, especially if you plan to invest regularly in ETFs. Questrade charges no commission to buy ETFs (though there’s a small fee to sell). It offers slightly more flexibility than Wealthsimple as you grow more experienced, including more account types and investment options.
Both platforms are regulated Canadian investment dealers and members of CIRO (the Canadian Investment Regulatory Organization), so your money has investor protection behind it. Either is a solid choice. Pick the one whose interface you find easier to use.
How to Think About Investment Risk as a Teen
All investing involves some risk, and the market will go up and down. There will be years where your investments are worth less than what you put in. This is normal, and for a teen investor it’s not really a problem, because you have time to wait it out.
The risk that actually hurts long-term investors isn’t market volatility. It’s panic selling. When markets drop 20%, the worst thing you can do is sell everything and lock in your losses. The investors who stay the course and keep contributing through downturns consistently come out ahead of those who try to dodge every dip.
Diversification is your best protection against unnecessary risk. Owning one company’s stock is risky. Owning a broad index ETF that holds 500 or 1,000 companies is far less so, because no single company’s bad quarter can sink your whole portfolio.
As a rule of thumb: the longer your timeline, the more risk you can comfortably take. At 17, you have 40-plus years before retirement. A broadly diversified stock index fund is entirely appropriate for money you won’t need for a decade or more. Keep safer options like HISAs and GICs for money you might need within the next 1–3 years.
Start Small, Stay Consistent, and Let Time Do the Work
You don’t need to understand every corner of the financial markets to start investing. You just need to start. Open an in-trust account with a parent, contribute what you can each month, put it in a simple index ETF, and let time do the heavy lifting.
The teens who build this habit now (even with $25 or $50 a month) will be decades ahead of their peers who wait until they feel “ready.” The best day to start was yesterday. The second-best day is today.
For more on building the savings habit that makes investing possible, our 10 money-saving tips for teens are a practical place to start.
Frequently Asked Questions (FAQ)
Can a 16-year-old invest in Canada?
A 16-year-old cannot open a brokerage account independently in Canada, but a parent or guardian can open an in-trust account on their behalf. This lets teens invest in real assets (stocks, ETFs, GICs) before reaching the age of majority. Once you turn 18 (or 19 in some provinces), the account transfers to you along with everything it has grown.
What is the best investment for a teenager?
For most teenagers, a broad index ETF is the best investment to start with. These funds spread your money across hundreds of companies automatically, keep fees very low (often below 0.25% annually), and historically deliver strong long-term returns without requiring you to pick individual stocks. In Canada, popular beginner options include Vanguard’s VEQT and Wealthsimple’s managed ETF portfolios.
How much should a teenager invest per month?
There’s no minimum, but $25 to $100 per month is a realistic and meaningful starting range for most teens. Consistency matters far more than the amount. Investing $50 per month starting at 16 will outperform investing $200 per month starting at 25, thanks to compound interest running over a longer time horizon.
What is a TFSA and when can teens open one?
A Tax-Free Savings Account (TFSA) is a registered Canadian account where all investment growth is completely tax-free. Canadians can open a TFSA at the age of majority in their province (18 in most provinces, 19 in BC, Nova Scotia, New Brunswick, and Newfoundland). The 2026 annual contribution limit is $7,000, and any unused room from prior years carries forward automatically.
Updated May 2026
Last updated: May 2026
Robert Puharich is the founder of TeenLearner, where he helps teens build real-world skills in money, AI, and life. With over 20 years in education and a Master of Education (M.Ed.) from UBC, he created TeenLearner to teach practical skills such as budgeting, career readiness, decision-making, and the wise use of technology. Robert is also a published author and business founder.
