Can kids buy stocks in Australia?

Minors in Australia cannot directly own stocks and most platforms won't let you open an account for anyone under the age of 18. However, their parents can invest on their behalf. Major brokers in Australia will let you act as trustee for your children. Once the child turns 18, the shares can be transferred into their own name, although this usually involves a one-off transfer fee.

How old do you have to be to trade stocks?

In Australia, you need to be at least 18 years old to open a trading account and buy and sell stocks.

How can you invest when you're under 18?

Unfortunately, you'll need an adult to invest on your behalf if you're under the age of 18. As we've explained above, it's possible for an adult to buy stocks using the tax file number of someone under the age of 18, which means the stocks are de facto held in their name.

What are the tax implications for children owning shares?

The ATO states that minors can earn up to $416 annually on investments held in their name before taxes apply. These are usually higher than the average adult's taxable income, going as high as 66%.

Can you buy shares for children with CommSec?

Yes, you can buy shares for children with CommSec, but you can't open an account in their name. Most brokers won't let children under 18 own shares directly. Instead, the parent can open the account as trustee for the child. When the child turns 18, the shares can be transferred into the child's name. In the case of CommSec, you will be charged $54 per share when you transfer the shares into the child's name.

What age should you start investing for kids?

The earlier you can start investing, the better off the child will be. This is because of how compound interest works. Let's take 2 examples. First you start investing when the child is born, giving them 18 years of compounding. If you initially invest $1,000 and add $100 a month, the child and compound 9% per annum on their 18th will have $58,658 in their trustee account with $36,058 coming from interest. Now say you start when the child is 12. Once again, you invest $1,000 initially and $100 per month. Again at 9% the child would get $11,213 on their 18th birthday with $3,013 in interest.