Kelly Pedersen was recently surprised to learn that her 14-year-old daughter had thousands of dollars stored in a digital wallet.
“She does all the entrepreneurial stuff. She runs a lemonade stand there and makes $400 or $500 on a Saturday,” he says. But that didn’t stop her from acting like a child, he said. “She goes to Starbucks and asks me to give her $10.”
Pedersen, head of retail at professional services firm PricewaterhouseCoopers, said this type of financial manipulation is not unusual for children her daughter’s age and younger. In fact, a PwC study released in March found that 86% of children between the ages of 7 and 14 (which PwC calls Generation Alpha) have their own money. Almost everyone, 97%, say they make spending decisions independently at least some of the time. PwC surveyed 1,004 children aged 7 to 14 (with a margin of error of plus or minus 3.7 percentage points) and 1,009 parents of children in that age range (with a margin of error of plus or minus 4.1 percentage points) between January 29, 2026 and February 13, 2026.
“Gen Alphas, they’re very entrepreneurial. They have their own money, and sometimes their parents don’t even realize they have money,” Pedersen says.
“They’re all into resale,” added Ari Furman, consumer market leader at PwC. “They make money by doing online auctions, buying and selling, and participating in marketplaces. Even if they don’t, they get paid to do pocket money, chores, and odd jobs. And they really care about making money.” Resale website Depop has a minimum age requirement of 13 years or older for sellers on its platform, and sellers under 18 may need parental permission and payment assistance.
And while those young people may know how to spend money, many parents want to see their children start thinking about the future and building savings and investment portfolios. Families have a variety of tools to support their goals. There are government-backed accounts such as 529 savings plans for education expenses and 530A or Trump accounts that families can use to build investment portfolios for their children. Major online brokerages also allow parents to open custodian accounts for their children so that they can invest on their behalf. Parents whose children have income can also open a custodial savings account or Roth Individual Retirement Account for their child.
Additionally, companies like Acorns and Greenlight offer accounts that help teach kids how to invest on their own. Acorns’ Early Invest is a custodial account with an app for kids, while Greenlight’s Investing for Kids service is a brokerage account held in a parent or guardian’s name. The child can make transaction requests that require the parent’s approval.
But since children can’t open these accounts themselves, financial experts say parents need to help them understand how investing works, including the benefits and risks of putting money into the stock market.
“Good money management is about making trade-off decisions, and we want to teach kids as early as possible to think about the consequences and make trade-off decisions,” said Noah Kerner, CEO of Acorns. “If you spend more, you save less, and if you put more into savings, you may not be able to (maximize) your money in investments.”
Education makes the concept of money less scary for children
Belen Woodard has been making money for herself since she was a child model at the age of six. She often wanted to donate some of that income to charity or use some of it to buy toys, she said.
Woodard, now 15, said money seemed “very big” to her when she was young, trying to understand how money worked. The example set by her parents and four older brothers helped her learn how to make her own spending decisions.
With help from her parents and siblings, and money she earned from modeling, Woodard founded More Than Peach, an art brand that promotes inclusivity, when she was just eight years old. The brand’s products are sold at Target, and Woodard has written two acclaimed children’s books. She is a member of Acorns’ Kid Advisory Board, which aims to promote financial literacy among young savers and investors. The entrepreneur and activist is thinking about bigger money goals, such as saving up to buy her own car as soon as she turns 16.
Woodard says many of her colleagues often get caught up in trends, like buying skincare or makeup products. Woodard likes to spend money shopping for clothes, especially at thrift stores, and going to the mall and movies with friends, but she tries to be cautious about her spending decisions. Although she appreciates having her own money and having the freedom to spend it on anything she wants, she says her priority is saving for short-term goals, like buying a car, and long-term goals, like future expenses after college or school.
It helps that Woodard has a required personal finance class in school. She says some money concepts, such as investing in the stock market, were scary at first, but after studying and understanding them, they weren’t so scary anymore.
When Woodard and her siblings were growing up, her parents didn’t “center” money in their conversations, said her mother, Tosha Woodard. She always had access to her own money and used a piggy bank from an early age until she graduated from debit cards in a joint account with her parents when she was 8 or 9 years old. Belen’s parents focused on nurturing their children’s talents and interests, such as entrepreneurship and education, and supporting their endeavors. She and her mother said Belen had never been a spendthrift, so her parents didn’t have to do much to correct her in that regard.
Children often learn about money vicariously through their parents’ actions, said Brittney Castro, a certified financial planner at financial technology platform Chime.
“One of the best things you can do as a parent is obviously to be in charge of your own finances and be mindful of the words you say about money, the way you think about money, the way you handle money on a day-to-day basis, because your kids are picking up on all of that, whether you realize it or not,” she says.
Set your kids up for success with the right tools
Parents have several ways to help their children become familiar with money and start saving for the future. You can open a joint savings account with your child at many banks, as long as the parent is the primary account holder. High-yield savings accounts typically offer higher interest rates than traditional savings accounts.
Families who expect their children to attend college may consider opening a 529 savings plan, which provides tax benefits such as tax-free growth when used for qualified education expenses and contributions that may qualify for state tax deductions. Funds in your account can be used for a variety of eligible education expenses, including college and trade school tuition and qualified professional apprenticeships. An adult must open and manage the account, but even children can contribute their own money.
The newly launched 530A or Trump account offers another way for parents to invest for their children. These function similarly to individual retirement accounts. For 2026 and 2027, contributions to your account will be up to $5,000 per year. Generally, withdrawals are not permitted before the calendar year in which the beneficiary turns 18. Starting that year, the account is generally taxed like an IRA. That means withdrawals are taxable, and a 10% penalty applies if you withdraw the money before age 59 1/2, with exceptions such as using the funds to pay for education or buy your first home.
Investment accounts can help you build wealth and help your child develop good money habits while learning the power of compound interest. Even if you or your child aren’t contributing much, “the key is to establish a habit,” Castro says.
Parents can help their children invest through custodial securities accounts, known as UTMA or UGMA accounts, with fewer withdrawal limits than 529 or 530A accounts. Parents can open these brokerage accounts for children under the age of 18, and children can begin building an investment portfolio of stocks, mutual funds, and bonds with their parents’ help managing the account. Once your child reaches a certain age, between 18 and 25, depending on the state, they will have full control over their account.
For children who earn money, parents may want to open a custodial IRA or Roth IRA on their behalf. Parents can contribute up to the 2026 regular contribution limit of $7,500 or the child’s gross annual income, whichever is lower.
Additionally, Fidelity offers teen investment accounts that are opened by parents but managed by teens who can make their own investment decisions with some guardrails. For example, teens cannot invest in cryptocurrencies or foreign currencies through these accounts. Charles Schwab has a joint brokerage account for teens and their parents.
Castro says the accounts and tools that are right for you will depend on your family and your children’s specific financial goals.
