The question of how to make money as a child is becoming increasingly common among teenagers who want to learn how to invest the savings they receive from their parents. Generally, these young people show an interest in understanding the financial world from a very young age and are willing to take the initiative to make their money work for them.
On the other hand, there are also many parents who have savings set aside for their children and want to maximize the return on that capital, either to enjoy the benefits or to prepare their children for the future.
In any case, the most suitable investment alternative is the Kids savings account, a special financial product for minors. Let’s explore this solution further in the next article.
Why invest from a young age? The best option to make money as a child
Starting the investment journey from a young age is an excellent strategy for those looking to optimize their savings and learn how to manage their money effectively. Although for a long time the world of investments was considered exclusive to adults, today this area has become more accessible and attractive to young people.
This is due to the series of benefits that investing from childhood offers. First, they tend to be long-term investments, which can generate significant returns thanks to compound interest. Second, it helps children develop financial skills that will serve them in the future.
In this way, they not only create a mindset of growth and responsibility, but also learn how to make money as children, gaining practical experience in managing their personal finances.
How to make money as a child: What is a Kids account?
For children who want to learn how to manage their money and maximize their savings, there are effective financial alternatives such as the Kids account or account for minors. This type of account is designed to provide them with a safe and educational introduction to the world of finance, allowing them to create an index fund portfolio and a savings portfolio.
The Cuenta Kids allows children to access two main financial products:
- Index funds: One way to teach young people how to make money as kids is through index funds. They are a popular option due to their simplicity in management and the low cost they entail.
When opting for these instruments, you can participate in the growth of a wide variety of companies without the need to select individual stocks.
It is important to consider that indexed funds for children can either be regular or socially responsible (SRI) investments, allowing young investors to also get interested in products aligned with sustainability.
Like other funds, indexed funds aim to replicate a specific index, such as the IBEX 35 in Spain or the S&P 500 in the United States. This means that, instead of trying to outperform the market, the fund seeks to match it.
As a result, this strategy reduces the costs associated with active management, as there is no need for a team of experts to constantly select stocks.
- Savings portfolios: Another option to learn how to make money as a child is the savings portfolio, as it includes a combination of savings products and investment funds, allowing for diversification of investments and optimization of capital returns.
Because it offers a mix of assets, children can familiarize themselves with different types of investments, understanding how each one can contribute to their financial goals.
Platforms like inbestMe provide personalized portfolios tailored to the interests and needs of young investors, making it easier for them to understand and manage their finances.
Requirements to access a Kids account
If you’ve made it this far, it’s because you’re interested in helping your child learn how to make money as a child, or because you’re a teenager with an interest in the world of investments. Either way, you should know that to access these financial products, there are a few requirements to meet. The main ones are outlined below:
- Parental consent: First of all, it is the parents or guardian of the child who make the investment. Although the child is the account holder, only adults are authorized to make investments until the child turns 18.
- Required documentation: Currently, investment accounts for minors can only be opened with a Spanish DNI, and the minimum amount to open a minor’s account is €1,000. Additionally, documents must be presented to verify the relationship or kinship between the minor and their parents or legal guardian.
- Choose the investment platform: inbestMe is one of the most prominent options to learn how to make money as a child, as it offers a Kids savings account tailored to the needs of younger investors.
How to make money as a child: Investment operation and management
After the Kids savings account is enabled, parents or guardians can start investing the assets. This can be done through inbestMe, a robo-advisor that provides intuitive tools to facilitate the investment process.
- Set up the account: The first step in this process is setting up the account, where you will need to decide from the various available investment portfolios that best align with the financial goals.
- Monitor performance: You can track how the investment is growing, allowing children to see the results of their savings and investments.
- Who controls it: The control of the investments lies with the parents or the child’s guardian. Although the teenager holds ownership of the account until they turn 18, only adults are authorized to make investments.
Use the inbestMe Kids Savings Account: Perfect for learning how to make money as a child.
If you want your child to learn how to make money as a child, one of the best options is to open a Kids account with inbestMe. This is a savings account that not only allows children to accumulate funds but also offers them the opportunity to invest in a variety of assets, thus fostering financial education from an early age.
inbestMe is a platform that provides access to the best funds on the market, keeping costs low and increasing investment returns. Additionally, it features educational tools that allow children to learn about how the financial market works.
Contact us and start today. Teaching young people how to make money as children through investment is a crucial step toward building a solid financial future.
