Abdullah Ahmed, a 15-year-old student from Scarsdale, New York, has established an investing club at his school that currently has 80 members.
In another example, 13-year-old Mizu Pope trades with notable enthusiasm, using money earned from neighborhood chores to fund her investments on the teen-focused app Greenlight, under her parents' supervision.
These young individuals were featured in a recent Wall Street Journal report highlighting a rise in Generation Z investors engaging with the stock market and planning for retirement early. According to the Journal, trades directed by minors on the Greenlight app increased by 77% compared to two years ago. Jennifer Seitz, the company's director of education, linked this trend to improved financial literacy among this age group. She observed that a growing number of children on the platform are setting up recurring transfers to their investment accounts, suggesting a focus on longer-term objectives.
Most American high schools have incorporated financial literacy programs into their curricula. Research from a consulting firm indicates that taking even one high school course could result in an eventual economic benefit of approximately $100,000 per student.
The approach of the youngest Gen Z members, born between 1997 and 2012, is notable for two aspects. They are not solely pursuing short-term gains or meme stocks but are opting for long-term holdings and extended growth cycles. Additionally, they are planning far into the future.
While some teens interviewed by the Wall Street Journal stated they are saving for college or a first apartment, a teacher at Winooski High School in Vermont mentioned that early retirement is a top discussion topic among her students. These young investors appear to understand that starting early and enduring market fluctuations is a viable strategy.
This trend coincides with a broader increase in stock market participation in the United States. CNN reported in September that Americans have more money invested in the stock market than ever before. Market involvement has recovered post-pandemic, with 62% of Americans holding stocks, whether as individual shares, mutual funds, or through self-directed retirement accounts.
Even during potential market downturns, these young investors possess a distinct advantage: time. They are leveraging compound interest, maintaining funded investment accounts, and concentrating on long-term savings goals.
Research from the World Economic Forum shows that 30% of 18- to 27-year-olds globally have begun investing in early adulthood. In comparison, 9% of Generation X parents and only 6% of baby boomers reported similar early starts. This could assist young adults in achieving retirement goals sooner and building wealth despite economic challenges like an unstable job market, housing issues, and student loan debt.
Experts caution that while interest in investing grows, there has been a parallel rise in risky financial behaviors such as cryptocurrency trading, high-risk day trading, and online sports gambling, partly due to looser regulations and app accessibility. Fraud, particularly involving cryptocurrency, is also increasing. FBI data reveals that investors lost $9.3 billion to crypto fraud in 2024, a 66% rise from 2023.