Trading Accounts For Kids: Five Platforms That Allow Children To Buy Stocks, Mutual Fund

Investing is no longer just for adults. Today, there are platforms that let kids explore the world of trading and investments under parental guidance. 

Whether it's buying stocks or starting a Systematic Investment Plan (SIP) in mutual funds, these platforms are designed to make financial learning easy and fun. Here are five platforms that allow kids to buy stocks and invest in mutual funds:

Who Is Minor

As per the Indian Majority Act, 1875, a person who has not reached the age of eighteen is considered a minor. A minor cannot use his account to make investments in India. They may, however, do so through a guardian appointed by the court or their natural guardian, which is their parent.

The minor must have a chequebook that needs to be signed by him and have his bank account altered once he reaches majority. In India, a minor is able to invest in mutual funds and stocks. Nonetheless, the guardian will manage the accounts.
 

Platforms For Kids To Invest

1. Brokers with minor accounts are registered with SEBI .

Parents are permitted to open minor accounts for their children with the majority of SEBI-registered brokers in India. The parent or guardian is in charge of managing these accounts and making investment decisions. This service, which is provided by well-known brokers like Zerodha and Upstox, makes it simple for children to begin investing under supervision.
 

2. Apps for Piggy Banks with Investment Choices

Investment elements are increasingly being incorporated into a number of financial literacy apps, like Junio and FamPay. These apps introduce children to mutual funds and other basic investment alternatives while teaching them about budgeting and saving. Because of its user-friendly interface, kids may easily browse it.

3. Fixed-Income Instruments 

Fixed deposits, Sukanya Samriddhi Yojana, and similar products offer safety but may fail to beat inflation, especially education inflation. Under the Fixed Deposit scheme for children, the parent or the guardian can open an account on behalf of the child. The child will receive the earnings from the FD until they reach the age of 18 or till the FD reaches maturity.

4. The stockal

Indians, including minors, can invest in international markets through the Stockal platform. To purchase fractional shares of large corporations like Apple or Amazon, parents can set up custodial accounts for their children. This diversifies their portfolio and teaches them about international markets.
 

5. The US-Inspired Model, Acorns Early

Despite being mainly accessible in the US, Indian fintech apps have been motivated to implement comparable functionalities by platforms such as Acorns Early. You can open an Acorns Early Invest account for any child under the age of eighteen who has a valid social security number if you are an Acorns Gold member. It is not necessary for the child to be your child.

When the kid reaches their Age of Transfer, they can move the money from their Acorns Early Invest account to an Acorns Invest account. 
 

Important Tips for Parents

Parents can start their children on the path to financial independence at a young age by introducing them to trading and investing. For young investors, these platforms make the process safe, instructive, and entertaining.

Supervise Investments: Ensure all transactions are monitored and explained.
Educate About Risks: Teach kids that investments can go up or down.
Focus on Learning: Prioritise understanding over profits.