How To Open A Minor Account And What Are The Benefits

Teaching your child about investing early can help them develop good financial habits that will last a lifetime.

There are many ways to do this, such as:

• Talking to them about finances and investing in general.
• Reading books and articles about investing.
• Opening an investment account for them.

Here's a step-by-step guide to opening an investment account for your child:

1. Log in to your EasyEquities account.
2. Navigate to the top-right menu and click on the profile icon.
3. Choose the option "Add an account for your kid."

Opening a minor account for your child and introducing them to investing at an early age can offer several significant benefits:

• Financial education: Teaching your child about investing from a young age helps them develop essential financial literacy skills, such as budgeting, saving, and understanding how investments work.
• Long-term wealth accumulation: Investing for a child early allows their investments to compound over time, potentially resulting in substantial wealth by the time they reach adulthood.
• Tax benefits: Utilizing a Tax-Free Savings Account (TFSA) can help your child grow their investments without incurring taxes on capital gains or dividends, enhancing their overall returns.
• Financial responsibility: Managing investments fosters a sense of responsibility in children as they learn to monitor their accounts, make investment decisions, and track their progress.
• Future financial security: Building a nest egg during childhood can provide financial security as they approach major life milestones, such as college education or homeownership.

Here are some other benefits of opening a minor account for your child:

• Compound interest: The longer the money is invested, the more time it has to benefit from compound interest, which can significantly boost the overall return on investments.
• Diversification: Investing in local stocks and exchange-traded funds (ETFs) allows for diversification, reducing the risk associated with a concentrated portfolio.
• Teaching patience: Investing teaches patience, as children learn that it takes time for investments to grow and that market fluctuations are normal.
• Empowerment: Giving children a sense of ownership over their finances empowers them to take control of their financial future and make informed decisions.
• Potential for higher returns: Historically, investing in stocks and ETFs has offered the potential for higher returns compared to traditional savings accounts, helping your child's money grow faster.
• Gift of financial independence: By starting early, you provide your child with a head start on their financial journey, increasing the likelihood that they will be financially independent and secure in adulthood.