Investing in stocks for a child is becoming significantly more popular

In January–November of this year, the number of OP Uusimaa's customers who bought stocks for children grew by roughly 26 per cent from the corresponding period last year. The volume of shares purchased for children also grew by 14 per cent this year compared to last year. 

According to OP Uusimaa's data, the most common choices for children's portfolios are well-known companies. The most common stocks owned by OP Uusimaa's underage customers, based on the number of customers, are Nordea, Fortum and Nokia stocks. Meanwhile, the three most purchased stocks by volume this year have been Nordea, Fortum and Neste Corporation. 

"I'm glad that more people have become familiar with investing for a child. Monitoring the development of investments is a good way to teach financial literacy and talk about how companies work," says Eevi Määttä, Senior Vice President, Personal Wealth Building at OP Uusimaa. 

Though investing in stocks for children is increasingly popular, the most common type of investment for children is investing in funds. Fund investments are typically made within a unit-linked insurance policy or on a book-entry account. The number of regular fund investment subscriptions for minors at all OP cooperative banks grew by 24 per cent this year. The most popular investment funds both in Uusimaa and nationwide were the OP-Moderate, OP-World Index and OP Brave mutual funds. 

Equity savings accounts becoming more popular 

Stock investments for a child can be made with a book-entry account or an equity savings account. In particular, the popularity of equity savings accounts for children has grown in recent years. The sales and dividends of stocks purchased for an equity savings account are only taxed when the returns are withdrawn from the account. For this reason, Eevi Määttä considers equity savings accounts to be very suitable for investing for children. Opening an equity savings account could also be an option for a Christmas present. 

"An investment for a child is a long-term investment, and many customers want to buy and sell stocks as the child gets older. This is why I think equity savings accounts are very suitable for investing for children. With an equity savings account, you can trade in stocks with no immediate tax consequences. Profits and dividends are only taxable when you withdraw money from the account or close your equity savings account," says Eevi Määttä.

Later, when the child turns 18, they can start trading in stocks personally. With the consent of guardians, the child can start trading once they turn 15. After the consent is given, the young person can view and make changes to all their owned savings and investments. 

If you have made investments for a minor, Määttä recommends having a discussion with them about savings in good time.

"Before the child's 18th birthday, you should think about their options for how to use the money together, or whether they should continue investing," says Määttä.

Stocks most owned by OP Uusimaa's underage customers (aged 0–17) by number of customers:

Find out more about  saving for a child ‍