How Old Do You Have to Be to Buy Stocks? Answered

How old do you have to be to buy stocks? Most people believe you must be 18 to buy stocks. But, that’s a misconception. I bought my first stock at age 10. Warren Buffett, the world’s most famous and successful investor, bought his first stock at age 11. When you buy your first stock is largely up to you — and your guardian (more on that below). There is no minimum age requirement for buying stocks. There’s no age maximum either. Just like using a savings account at a bank.

Even a 5-year-old could technically begin trading stocks. So, if you’re able to read this article, you’re not too young to begin investing. You can buy stocks, trade stocks, invest in other investments such as mutual funds and exchange-traded funds, etc. regardless of age if your guardian will be your custodian.

If you’re reading this, you probably want to start investing at a young age. Congratulations! If you get started at a young age, and keep at it, you’ll become very, very wealthy. You don’t even have to be a great investor.

Reasons to Invest While Young

For starters, working hard while young gets you in the money mindset. You understand its value. Working makes you smarter. Working gives you a reason to wake up each morning. Working boosts your self-esteem. All this becomes what is referred to as your money mindset. When you get started working young, you have a positive money mindset. You know you can make money. Life will be good.

Another reason is because of compound interest. Compound interest is magical. The sooner you earn the money, the faster it can start working for you. Think of a dollar as an employee. That employee works hard for you by earning you interest. Then that interest earns you more interest. Pretty soon, $10 is now $11. Then it becomes $12 and that number keeps growing.

The earlier you begin earning, saving, and investing, the richer you can get. If you begin saving early enough, you can retire at 30 if you’d like! Then you can play video games all day and live off the interest! Seriously! However, that lifestyle would get old after awhile, but still. My point is you can do whatever once you have a certain amount of money.

If your parents don’t support you bettering yourself, here is how old you have to be to begin investing on your own. It’s the age of majority:

Age Requirements (by state)

Arkansas18 – or when you graduate high school, whichever is later
District of Columbia18
New Hampshire18
New Mexico18
Nevada18 – or when you graduate high school, whichever is later
New Jersy18
New York18
North Carolina18
North Dakota18
Ohio18 – or graduation from high school, whichever comes first
Rhode Island18
South Carolina18
South Dakota18
Tennessee18 – or graduation from high school, whichever is later
Utah18 – or graduation from high school, whichever comes first
West Virginia18
Wisconsin18 – or if you’re still in high school at 18, it’s age 19

There are several ways you can begin investing if you’re still considered a minor in your state. Below I’ve listed each method and explained how to get started. Some of this stuff may sound confusing. But, investing at a young age is simple.

How to Begin Investing While Young

Invest within a Custodial Account (UTMA/UGMA)

Uniform Transfers to Minors Act (UTMA) or Uniform Gifts to Minors Act (UGMA) accounts can be opened. These are investment accounts wherein you buy stocks or any type of investment. Which one you and your parent/guardian choose depends on your state. It’ll be one or the other. Any brokerage firm will help you decide which to open.

With these accounts, a parent/guardian gets assigned as the account owner, while you are the beneficial owner. Then, once you reach the age of majority, you automatically become the sole owner. You can then name your parent/guardian as a beneficiary if you wish. You don’t have to sell anything once you reach legal age. The transition is quite smooth.

I had one of these accounts not long ago. It was really convenient actually. It functioned just like the solo accounts I have now. Once I turned 19 (I live in Nebraska) I was informed that the account was now my own and I could name anyone as the beneficiary. Talk about a great feeling.

Invest within a Roth IRA

You can start a Roth IRA at any age. This is definitely my favorite investment vehicle. That’s because you put money in that has already been taxed. Then it grows tax-free.

Let’s say you put in $100. You’ve already paid taxes on that $100. Over time, it will grow to $1,000. Which would you rather pay taxes on? $100 or $1,000? For a young person, the answer is easy. Always pay taxes when you’re really young. You’re in a low tax bracket.

To convince your parent/guardian to open a Roth IRA on your behalf, there are many ways to pitch it.

For starters, tell them that Roth IRA money can be used for educational expenses. It can essentially be a college fund. The money can also be used to buy your first home. You can even take out the principal when you would like.

The only hangup is you must wait until you’re age 59 1/2 to pull out your investment income for non-educational/first home expenses. But, that’s fine. Building wealth while young is about having patience.

Suggested Article: How to Become a Millionaire by Just Fully Funding Your Roth IRA

Or — You Can Simply Wait to Invest in the Stock Market

The reason states have this age of majority rule is because officials believe people under the age make poor decisions. Law makers believe the age of majority is protecting you from making poor investment decisions. They feel that you shouldn’t invest on your own until you’ve matured. I get it. There is some truth to that. I’m a much better investor now than I was when I was 10.

If you’re okay with waiting (or if your parent/guardian won’t give consent) it’s not the end of the world. The fact is, saving money is more important than investing.

Think about it like this.

Today, you can make $10. Mow lawns, resell stuff on Craigslist, do anything. So in one day, you earn $10. Pretty much the best case scenario when investing is that you’ll make 12% on your investments. If you were to invest that $10 to earn that fantastic 12% return, your money would then be worth $11.20. Yep — it would take one year to earn $1.20. So what should your focus be? $10 in one day or $1.20 cents in one year?

That’s why earning money and saving money will always be more important than investing. It can be done much faster.

What to Invest in…

Here’s a surprise. I actually don’t recommend trading stocks at a young age. That’s because trading stocks in general is a pretty bad idea. Let me ask you a question. Can you predict the future? No? Then why do you think you can predict the future of a company? Focus on long-term investments.

Invest in either mutual index funds or exchange-traded funds. These are pretty darn safe bets. If you invest in good, low-fee funds while young, you’ll do really well. These funds track the stock market. The S&P 500 has done nearly 12% since inception. That is far more that most stock traders ever make. Stick with the 12% number. Then focus your energy on earning more income. Because income beats investing ability all day long.


  • Be patient
  • Invest in index funds with low fees and no loads
  • Invest in a fund with a solid track record of performance (10+ years)
  • Go through a quality brokerage firm like Vanguard or Fidelity
  • Think long-term. When the market dips and you ‘lose’ $20,000 — who cares? It will recover.
  • Consider the money you invest to be untouchable for at least five years.
  • Work hard to make your taxes as low as possible. Hire an accountant if you’d like.
  • Don’t check account balances every day. Remember, you’re thinking long-term. You can ignore the day-to-day nonsense.
  • Enjoy the ride.

And that’s how old you have to be to buy stocks. Suggested Next Article: These Are Some of the Most Popular YouTube Videos About Money (Funny)