Fidelity launches no-fee teen brokerage accounts

In an effort to lock in teen business before they seek out competitors when they turn 18 (aka Robinhood and apps like it), Fidelity is offering teens aged 13 to 17 debit cards, and investment and savings accounts. Called the Fidelity Youth Account, teens won’t be charged account fees or commissions.

Why should we care?
Teens are a hot market for legacy financial companies and fintechs alike: fintechs, including Step and Current are rolling out banking products for teens, while large banks like Chase and Wells Fargo launch banking offerings for kids. Financial companies are competing for “customers for life” who can grow into various products as their financial needs evolve. Fidelity’s offering is also part of an industry movement to cut trading commissions to zero. It offers teens three core capabilities: “Save and Spend” (banking), “Learn” (financial education), and “Plan and Invest”. “Our goal for the Fidelity Youth Account is to encourage young Americans to learn through action and foster meaningful family conversations around financial topics,” Jennifer Samalis, senior vice president of acquisition and loyalty at Fidelity Investments, said. The account is designed to allow teens to build healthy money habits through “learning by doing,” she added. As a safety rail, Fidelity teen investors won’t be able to trade options or trade on margin. In total, Fidelity has 83.4 million accounts and $10.4T assets under administration.