The conversation around financial literacy is evolving and fast. Today’s teens aren’t just swiping through TikTok or gaming on weekends. Many are launching businesses, earning real money, and learning to invest before they even hit high school.
But how do you support a 12- or 13-year-old who wants to make money online, especially in a world that often restricts minors from opening bank accounts or registering businesses?
The answer lies in innovative structure, mentorship, and a strong entrepreneurial mindset.
Let’s break down a proven approach to helping kids generate income, build businesses, and start investing even before they can legally vote.
The Foundation: Support, Structure, and Smart Strategy
Most kids under 18 can’t legally open a business or bank account alone. This is where parental involvement becomes crucial. Suppose your child is eager to launch a YouTube channel, Etsy shop, or affiliate marketing business. In that case, they’ll need your help to set up a structure, ideally, an LLC.
Why an LLC per child?
Each child’s business venture should be seen as a unique legal and financial entity. When structured properly, it not only teaches responsibility but also creates a pathway to hand off a real business when they turn 18.
Important steps:
- Set up an LLC with a parent as the owner
- Open a custodial bank account with the child as a signer
- Introduce business financial tools (like credit cards) to teach behavior, not just theory
From Hobbies to Hustles: Turning Interests into Income
The fastest way for a young person to succeed in business is to monetize something they already love or excel at. Instead of forcing them into generic side hustles, start by asking:
What are you already good at? What excites you enough to talk about it daily online?
Here are real teen-led business examples:
- A volleyball player teaching spiking and digging skills online
- Teens offering hydration and nutrition tips on social media
- Makeup reviews by teenage girls that bring in hundreds of thousands via Pinterest
- Kids creating courses, offering coaching, or selling niche gear related to their sport or hobby
The key is to lean into passion, because when kids are engaged, consistency (and profit) follow naturally.
The Power of the Affiliate Model
For kids new to business, affiliate marketing is one of the easiest ways to begin. They don’t have to create a product; they need to promote one they already use or love. This works great for:
- Books
- Educational games
- Wellness products
- Even digital tools like trading apps or financial literacy platforms
With a parent’s oversight, affiliate links can be placed on blogs, social media platforms like Pinterest, Instagram, or YouTube, generating recurring revenue.
And yes, Shopify, Etsy, and eBay are still great platforms. Even a simple Pinterest store (with product reviews) can make $3,000–$400,000 a year.
Financial Literacy Starts with Real Money
One of the most innovative financial tools for teenagers is a Roth IRA. Once a child earns legitimate income (even from their parents’ business), they’re eligible. Contributions grow tax-free for life, making this an essential long-term wealth builder.
Why a Roth IRA matters:
- No taxes on investment gains if used properly
- A safety net in later life
- Builds the concept of delayed gratification early on
Kids can contribute up to $7,000 per year, and with smart investments (such as stocks, crypto, or index funds), that money compounds quickly.
Use apps like:
GravyStack (for entrepreneurial “missions” and gigs)
iFlip (for learning market-based investing strategies)
Pro tip: Let kids experiment early, but guide them away from trading if they aren’t committed to daily market awareness and education. Long-term investing beats gambling.
50% Rule: The Golden Teen Finance Strategy
Instill this principle:
Earn, spend some, invest the rest.
Ideally, 50% of their earnings should go toward savings or investments.
Why? Building financial muscle early creates a foundation most adults wish they had in their youth. It gives teens control, confidence, and choices that will benefit them later in life. Whether they attend college, start a business, or pursue a career.
The Role of Mentorship and Community
Mentorship changes the game.
Whether you’re a parent or a teen, surrounding yourself with entrepreneurial thinkers is one of the most important steps toward success.
That might mean:
- Internships with local real estate agents, business owners, or creators
- Joining online mentorship groups or free membership communities like AskLoral
- Reading books like Think and Grow Rich or The Millionaire Maker
“Entrepreneurs talk to entrepreneurs. Employees talk to employees. Who do you want to become?”
Making It Real: How to Earn $1,000/Month as a Teen
Here’s the breakdown:
- $50/day → $250/week → $1,000/month
- That’s the benchmark. And it’s more achievable than you think.
Examples:
- Babysitting or nannying
- Coaching neighborhood kids in sports or music
- Social media consulting for local businesses
- Reselling thrifted items online
- Teaching makeup, dance, or tech skills
The goal isn’t to get rich overnight. It’s to build habits, discipline, and confidence that last a lifetime.
Final Thought: Don’t Wait
Many parents want to protect their kids from failure. But shielding them from the financial world may also shield them from growth.
Help your child explore entrepreneurship. Teach them about investing. Give them permission to fail and learn from their mistakes.
And for teens: don’t wait for permission. Ask questions, find mentors, and start where you are. You don’t need to be an adult to take your future seriously.
