If you're a parent wondering whether your teenager can start investing, or a teen itching to buy your first shares, you're asking the right question. The short answer is that minors can't open investment accounts on their own in Canada — but that doesn't mean young people have to sit on the sidelines. There are several legitimate ways to start building wealth before turning 18 or 19, depending on the province or territory.
This guide breaks down the legal landscape, the account options available, the tax implications, and why starting early can make a meaningful difference.
The short answer: minors can't invest on their own
Under Canadian securities law, you must be the age of majority in your province or territory to open an investment account in your own name. That means a 15-year-old in Ontario or a 17-year-old in British Columbia cannot independently sign up for a brokerage account, buy stocks, or trade exchange-traded funds (ETFs).
This isn't a technicality — it's a legal requirement rooted in contract law. Minors generally can't enter into binding contracts, and brokerage agreements are contracts.
But here's the good news: there are well-established workarounds. Parents, guardians, and grandparents can invest on behalf of a child, and some of these options come with meaningful tax advantages.
What is the age of majority across Canada?
The age of majority isn't the same everywhere in Canada. It varies by province and territory:
18 years old: Alberta, Manitoba, Ontario, Prince Edward Island, Quebec, and Saskatchewan
19 years old: British Columbia, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, and Yukon
This distinction matters because it determines when a young person can open their own investment account, sign a brokerage agreement, and manage their own finances without a parent or guardian involved.
How parents can invest on behalf of a child
Although minors can't invest directly, parents have several options to invest on their behalf. Each approach has its own rules, benefits, and considerations.
Informal in-trust accounts
An informal in-trust account is a non-registered investment account that a parent opens "in trust for" a child. The parent manages the account — making investment decisions, placing trades, and monitoring the portfolio — until the child reaches the age of majority. At that point, the assets legally belong to the child.
These are not formal trusts. There's no trust deed required, and they're relatively simple to set up. Most Canadian brokerages offer them. The parent typically has flexibility in what they invest in, including stocks, ETFs, bonds, and mutual funds.
One important consideration: because these accounts are non-registered, the investments don't receive the same tax-sheltering benefits as registered accounts. And the attribution rules (more on those below) can affect how investment income is taxed.
Registered Education Savings Plans (RESPs)
An RESP is one of the most common ways Canadians invest on behalf of a child. Anyone can open an RESP for a child — a parent, grandparent, family friend, or other relative.
Here are the key details:
The lifetime contribution limit is $50,000 per beneficiary
The Canada Education Savings Grant (CESG) matches 20% of the first $2,500 contributed each year, up to $500 per year, with a lifetime maximum of $7,200
Investments within the RESP grow tax-deferred
When the beneficiary withdraws funds for qualifying education expenses, the withdrawals are taxed in the student's hands — not the contributor's
Because most students have little or no other income, the tax on RESP withdrawals is often minimal or zero. The CESG is essentially free money from the federal government, making RESPs a particularly effective vehicle for long-term education savings.
Custodial brokerage accounts
Some brokerages allow parents to open custodial accounts on behalf of a minor. In this arrangement, the parent manages all trades and investment decisions, but the account is designated for the child. When the child reaches the age of majority, they become the account holder and take full control.
Custodial accounts function similarly to informal in-trust accounts, though the specific terms and features vary by brokerage. It's worth reviewing the details of any custodial arrangement before opening one.
What about TFSAs and RRSPs?
Two of Canada's most popular registered accounts — the Tax-Free Savings Account (TFSA) and the Registered Retirement Savings Plan (RRSP) — have age-related rules that matter here.
TFSAs: a TFSA cannot be opened until the account holder reaches the age of majority in their province or territory — 18 or 19, depending on where they live. Contribution room begins accumulating on January 1 of the year a person turns 18, regardless of province. In provinces where the age of majority is 19, the contribution room from age 18 carries over, so the account holder can contribute two years' worth of room as soon as they open the account.
RRSPs: technically, there is no minimum age to contribute to an RRSP. A minor with earned income who files a tax return can build RRSP contribution room. However, this is uncommon in practice — most minors don't have enough earned income to generate meaningful contribution room, and an RRSP is typically not the most effective savings vehicle for a young person.
Tax rules parents should know
Investing on behalf of a child can have tax implications, and the rules aren't always intuitive. The most important concept to understand is attribution.
Attribution rules: when a parent gifts money to a minor child and that money earns investment income, the income — including interest and dividends — is generally attributed back to the parent for tax purposes. This means the parent reports that income on their own tax return, regardless of whether the investment is held in the child's name.
However, there's an important exception: capital gains earned by the minor are not attributed back to the parent. Capital gains are taxed in the child's hands. Since most minors have little or no income, these gains are often taxed at a very low rate or not at all.
RESP withdrawals: educational assistance payments (EAPs) from an RESP are taxed in the student's hands, not the contributor's. Because students typically have modest incomes, the tax burden on these withdrawals tends to be low.
Understanding these rules can help parents plan more effectively when investing on behalf of their children.
When investing makes sense for a teen
Starting early — even with small amounts — can have a surprising impact over time. Here's why the teenage years can be a valuable time to begin investing:
Time horizon: a teenager who starts investing at 15 or 16 has decades of potential compounding ahead. Even modest contributions can grow meaningfully over 30 or 40 years
Building habits: regular contributions, even small ones, help establish a savings and investing habit that can last a lifetime
Learning by doing: managing (or watching a parent manage) a real portfolio teaches lessons that no textbook can replicate — how markets fluctuate, why diversification matters, and what it feels like to ride out a downturn
Financial literacy: understanding concepts like risk, compound growth, and asset allocation at a young age can lay the foundation for stronger financial decision-making later in life
The goal isn't to chase returns or pick winning stocks. It's to develop a healthy relationship with money and a long-term perspective that serves well into adulthood.
What happens when a minor turns 18?
Reaching the age of majority is a significant financial milestone. Here's what changes:
In-trust account assets transfer to the child, who gains full control over the investments
TFSA eligibility begins — the young adult can open a TFSA and start contributing (contribution room starts accumulating at 18, so those in age-19 provinces will have two years of room available when they open their account)
Brokerage accounts can be opened independently, allowing the young adult to buy and sell investments in their own name
RESPs can continue to be used for qualifying education expenses — the account doesn't close when the beneficiary turns 18
This transition is a good opportunity for a conversation about financial goals, risk tolerance, and long-term planning. The habits and knowledge built during the teen years can make this transition smoother and more confident.
