Most teenagers are focused on school, friends, part-time jobs, and figuring out who they are. But what many don’t realize is that time is their greatest financial asset. The earlier you begin investing—whether it’s money, skills, or effort—the more powerful your long-term financial future becomes. The compound effect of starting early can’t be overstated.
You don’t need a trust fund or Wall Street-level knowledge to begin making smart money moves. What you do need is awareness, a bit of consistency, and the courage to think ahead. If you’re under 20 (or guiding someone who is), these are the eight investments worth starting now to build a strong financial foundation and unlock greater freedom down the line.
A Roth IRA
Even if you’re only working part-time in high school or during the summer, you can start contributing to a Roth IRA as long as you have earned income. The beauty of this retirement account is that you contribute post-tax dollars, meaning your withdrawals in retirement are completely tax-free. Since teens are typically in the lowest tax brackets of their lives, it makes sense to pay taxes now and let decades of compounding grow the balance tax-free.
A Roth IRA can be used for more than retirement, too. After five years, you can withdraw contributions (not earnings) penalty-free. Plus, there are special allowances for qualified education expenses and first-time home purchases. Starting one early gives you flexibility and financial security far into the future.
Low-Cost Index Funds
Learning how to invest in the stock market is a valuable skill, and index funds are a beginner’s best friend. They’re diversified, easy to manage, and often come with minimal fees. Even small amounts of money, when invested consistently in an S&P 500 index fund or similar, can grow into something substantial.
For a teen, investing $50–$100 per month may not seem like much, but with 40+ years to grow, that habit alone could build hundreds of thousands of dollars in wealth. Start simple. Open a brokerage account (with parental guidance if under 18), and learn by doing.
Yourself: Skills, Education, and Learning
Not every investment is monetary. Arguably, the most important investment a young person can make is in themselves. Learning how to code, understanding digital marketing, taking on public speaking, or developing financial literacy can pay off more than any stock market return. The more skills you stack, the more valuable you become in any career.
Reading books, listening to podcasts, or taking online courses may not feel like “investing,” but these small decisions shape your mindset and earning potential. Early self-investment builds a competitive edge and lifelong confidence.
A High-Yield Savings Account
It’s not glamorous, but having a high-yield savings account (HYSA) teaches discipline and prepares you for unexpected expenses. While the returns aren’t life-changing, they’re far better than traditional savings accounts.
More importantly, a savings habit helps develop a cushion—a form of self-respect that says, “I’ve got myself covered.” Set up an automatic transfer from a checking account and build an emergency fund over time. Having $500–$1,000 in savings as a teenager is empowering and sets the tone for how you’ll treat money as an adult.
Time and Energy in Passion Projects
What you do outside of school or work is an investment, too. Whether it’s a blog, a YouTube channel, a small Etsy shop, or even learning photography, these passion projects often grow into something lucrative or, at the very least, help you build entrepreneurial skills and a digital footprint.
Starting early allows room for failure and experimentation. Teens who treat hobbies like side hustles gain confidence and often stumble into career paths they never expected.
Social Capital and Relationships
This one’s often overlooked, but it’s a serious long-term investment. Building a network of people who support, challenge, and inspire you will open doors no degree can. Learn to nurture relationships with mentors, teachers, peers, and professionals. Show up with curiosity and kindness.
As you grow older, these relationships may turn into job referrals, business opportunities, or collaborative partnerships. Your ability to connect with people early in life can shape everything from your mindset to your net worth.
Health and Wellness Habits
It might sound strange to think of health as an investment, but the truth is that your physical and mental well-being has a massive impact on your ability to earn, perform, and enjoy life. Eating well, moving your body, learning how to manage stress—these aren’t just lifestyle choices, they’re foundational habits that help you operate at your best.
Starting good habits before the age of 20 makes them second nature later on. The earlier you invest in your wellness, the less you’ll spend on recovery later.
A Basic Budget or Money Tracking Habit
Finally, the simple act of knowing where your money goes is a game-changer. Teens who start tracking their income and spending (even if it’s just allowance or a paycheck from a summer job) build a sense of awareness and control that most adults still struggle with.
You don’t need complicated software or spreadsheets. A notebook or app like Mint or YNAB (You Need a Budget) can help you see patterns and set early goals. It’s not about perfection; it’s about becoming intentional with your money.
Why Starting Early Matters
All of these investments (financial, personal, social) share one thing in common: time amplifies them. When you start before 20, you create decades of advantage. Small actions compound into meaningful results. Most millionaires didn’t hit the jackpot or build a business empire overnight. They got consistent early. The earlier you understand this, the sooner you can start shaping a future that gives you choices, freedom, and peace of mind.
Starting early doesn’t mean you have to be perfect. You will make mistakes, and that’s okay. What matters most is having the courage to begin.
If you’re under 20, which of these investments are you already exploring? If you’re older, what do you wish you had started earlier, and what advice would you give your younger self?
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