Have you started an investment account for your child? Money Smart Week 2023 is a great time to learn how. It’s one of the greatest gifts you can give your children, and our accounts are easy to open. Young people have time on their side. The earlier they start their investment journey, the more time they spend being in the market, harnessing the value of compounding growth.  Digital investment platforms like SatrixNOW make investing simpler and more accessible. You can invest any amount, and even small amounts can grow exponentially over the years.

Thembeka KhumaloSenior Client Experience Manager at Satrix says, “It’s beneficial to involve children in the investment process as soon as they’re old enough, as they can gain a sense of ownership over their portfolio from a young age. Consider empowering them to earn their investment contributions through household chores and ‘kid-trepreneurial’ activities. Show them where their money is invested and take time to explain how things like exchange traded funds (ETFs) work. If they’re comfortable with the investment landscape at age 12, imagine how much market mastery they’ll possess as adults.”

Khumalo gives a breakdown of what you need to know when starting to invest for your children.

When to Open an Investment Account for a Minor

The best time to start investing for a minor is as soon as they are born. Starting early helps to maximise overall returns and build a portfolio over time. Starting early also means you can afford to take on more risk with an investment portfolio. The benefit of time means the portfolio can weather short-term market fluctuations and move in an upward trajectory over the long term.

How to Open a Minor’s Investment Account

When opening an account for a minor on an investment platform, such as SatrixNOW, the parent or legal guardian must have a FICA-verified account to get started. Once the parent’s account is opened, the parent would need to log in, select the “Add your Child’s Account” option from your profile menu and follow the four steps outlined to open an account for your child. The process is quick and straightforward. A welcome email will be sent with the new account's username and a prompt to create a password. A second email will be sent between 24-36 hours, indicating that the account has been verified and is ready to fund.

Can Extended Family or Friends Open an Account for Minors? 

Only parents and legal guardians can open investment accounts for minors, but extended family or friends can fund the child’s account using a debit order authority form. The form can typically be found in the platform’s help centre or you can request it from the SatrixNOW client engagement team. The form needs to be signed by the bank account holder and parent or guardian and submitted along with a copy of their (extended family member’s) ID.

What Happens to the Investment Account When the Minor Turns 18 

When a minor turns 18 and has full contractual ability (i.e. is legally an adult), the investment account is transferred to them. An email is sent out to the email address on record (parent or guardian’s) detailing the process to be followed to transfer the account to the 18-year-old account holder.

Can a Minor Make Withdrawals and/or Investment Decisions While Under 18? 

No, the minor cannot make legal decisions on their investments until they are 18. The parent or legal guardian will act as an Authorised User on the minor’s account. This is not to say that older children can’t be involved in the process. It is encouraged that you take your children along on the investment journey from as early as possible.

What Type of Products are Best to Include in a Minor’s Investment Account? 

The Satrix Access Range is a great place to start, offering access to the market in a diversified manner and at a low cost. This range includes four of our flagship funds, catering to a range of investment horizons and risk appetites with both local and global exposure.

Tax Implications of Opening an Investment Account for a Minor 

If a parent makes an investment on behalf of a minor, all income, dividends, and interest earned from the parent’s investment will be taxed. This applies to income received by minor children, stepchildren, and adopted children. If any shares are sold and there is a capital gain, this amount must be included in the parents’ capital gains calculation.

Another consideration is that an individual can donate up to R100 000 tax-free annually. Amounts over R100 000 will be subject to donations tax (current rate is 20%). A minor child’s investment does not form part of a parent or guardian’s estate. Should a parent or guardian pass away, the minor’s investment will not be subject to estate duty and other taxes.

Just Start

An investment is an incredible gift to give a child, and it can be made even more special if they are included in the process from a young age. Understanding the investing landscape, and developing positive saving and investing habits early on, will set children up with strong financial foundations that will stand them in good stead for the rest of their lives. 



Satrix Investments (Pty) Ltd is an approved FSP in term of the Financial Advisory and Intermediary Services Act (FAIS). The information does not constitute advice as contemplated in FAIS. Use or rely on this information at your own risk. Consult your Financial Adviser before making an investment decision.

While every effort has been made to ensure the reasonableness and accuracy of the information contained in this document (“the information”), the FSP’s, its shareholders, subsidiaries, clients, agents, officers and employees do not make any representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaims all liability for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance upon the information.