Teen Accounts on Payment Apps Offer Lessons on Saving, Stock Trading
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How are teens using specialized payment and finance apps today?
Here's your Money Briefing for Friday, June 23rd. I'm J.R. Whalen for The Wall Street Journal. Managing money and creating a budget are responsibilities typically associated with adulting. But teens growing up in a digital world are getting a head start understanding personal finance through apps geared toward them.
It basically allows them to create their own identities on these accounts that are usually attached to a parent's account. And it gives them their own spending power. They can maybe even trade stocks. They can create savings accounts. And many of these accounts are also linked to a debit card.
We'll talk to Wall Street Journal personal finance reporter Oyen Adedoyen. Plus, we'll hear from a mother of twin 15-year-olds who use payment apps. After the break.
For teens, it's easier than ever to sign up for payment apps to gain financial freedom. And even though many apps have launched versions geared toward teens, that freedom comes with some risks and often requires parental oversight.
Which companies have launched teen accounts and what features do they offer?
We'll hear from a parent of twin 15-year-olds in a moment, but first, WSJ personal finance reporter Oyen Adedoyen joins us. So, Oyen, what are some examples of apps that have launched special accounts for teens?
Amazon, Uber, Cash App, Venmo, even Fidelity Investments have launched specialized teen accounts in recent years for teenagers between the ages of 13 and 17.
And what does it allow them to do?
It basically allows them to create their own identities on these accounts that are usually attached to a parent's account. And it gives them their own spending power. They can maybe even trade stocks. They can create savings accounts. And many of these accounts are also linked to a debit card.
Why are they marketing themselves to teens? And what rewards do these tech companies reap from targeting younger customers?
I spoke with someone who has experience working with fintech companies, and he was telling me that banks and companies like Uber, Venmo, Cash App like to create a certain stickiness with their customers. So when someone is involved with a bank, when they're young, maybe as a teenager, they're less likely to leave that bank when they grow older and progress into adulthood.
Now, you mentioned stock trading and saving and purchasing. They require some sort of parental involvement before a teen can sign up?
Why are fintechs and tech companies targeting teenagers with teen accounts?
Yes. So for many of these apps, people under the age of 18 could not have their own accounts. So in the cases of a Venmo or a Cash App or even a Fidelity investment account, they have to have a link from a parent who already has an account in that system so that the teen can then create their own account with that parental oversight.
Arizona resident Layla Hyshaw, the mother of 15-year-old twins, has been providing some of that oversight. So, Layla, your son and daughter have downloaded an assortment of apps, but you actually got your daughter started with a payment app when she was seven. Tell us about that and what you were hoping she would learn about banking and spending.
Well, yes, I have three kids. And at the time, she was really wanting to have her own money. So it worked for everyone to get on the same page as far as how they're going to be paid for their chores. So when I select a green light, that what attracted me to it was that I could track their chores, they could check it off, and then they would be paid for that. And then they could manage their money.
How do you keep an eye on their transactions?
With Greenlight app, there is a parent approval. So anything that they want to exchange shares on their stock market, I have to approve it. For other things such as expenses, I can just see what's happening and set parameters on how much they can spend and discuss budgeting with them on what they're going to spend on food or shopping. And I can see everything in real time.
And some of these apps allow teens to do stock trading. How do you feel about that?
Yes, I didn't realize that until my son is the one who's very interested in the stock market. And he said, hey, mom on Greenlight, we are able to do some purchase of stocks in exchange.
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Chapters
5 chapters
1
How are teens using specialized payment and finance apps today?
0:02–1:13
2
Which companies have launched teen accounts and what features do they offer?
1:13–2:40
3
Why are fintechs and tech companies targeting teenagers with teen accounts?
2:40–4:52
4
What parental controls and oversight are required for teen accounts?
4:52–6:46
5
How did one parent start her 15‑year‑olds on payment apps and what did she hope they'd learn?
6:46–8:43
Speakers
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