Investing in Your 20s: The Student & Young Canadian's Guide to Building Wealth

Your 20s Are Your Investing Superpower

You don't need a lot of money to start investing. You don't need to understand complex financial jargon. What you have is something more valuable than any amount of cash: time.

Here's why starting now—even with just $25—could be the best financial decision you ever make.

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Why Your 20s Are the Most Valuable Investing Years

Here’s the uncomfortable truth that no one tells you: The money you invest in your 20s is worth more than money you’ll invest at any other age.

Not because you’ll earn more. Not because you’re smarter. Simply because of time.

The $100/Month Experiment

Let's say two people each invest $100/month, earning 7% annually. Same amount, same return—but different starting ages:

Start at 22, stop at 65
$340,000
Total invested: $51,600 over 43 years
Start at 32, stop at 65
$153,000
Total invested: $39,600 over 33 years

Starting 10 years earlier = $187,000 more wealth. That's not a typo.

The first person invested only $12,000 more, but ended up with $187,000 more. That's the power of compound growth—and you can only unlock it by starting early.

The Math is Ridiculous (In Your Favor)

Here’s what $100/month invested in XEQT (assuming 7% average return) could become:

Starting Age Age 65 Value Total Invested Growth
20 $396,000 $54,000 $342,000
25 $275,000 $48,000 $227,000
30 $189,000 $42,000 $147,000
35 $128,000 $36,000 $92,000
40 $84,000 $30,000 $54,000

Starting at 20 vs 40 = 4.7x more wealth with the same monthly amount.

Use our compound interest calculator to run your own scenarios.

The Rule of 72: Divide 72 by your return rate to see how fast your money doubles. At 7%, your money doubles every ~10 years. Start at 22, and your money could double 4+ times before you retire.

Why Students & Young Canadians Avoid Investing (And Why They Shouldn’t)

The Excuses That Cost You Millions

"I don't have enough money to invest."
You can start with $1 on Wealthsimple. Literally one dollar. Fractional shares mean any amount gets invested—you don't need to afford a full share of anything.

"I need to pay off my student loans first."
If your loan interest is under 5%, you can do both. Invest while paying minimum loan payments. The math often favors investing, especially in a TFSA where growth is tax-free.

"I'll start when I have a real job."
The $50/month you invest now is worth more than $200/month invested 10 years from now. Time beats amount. Every time.

"Investing is too complicated."
XEQT is one fund that holds the entire global stock market. Buy it and forget it. That's the whole strategy.

"What if the market crashes?"
Crashes are opportunities when you're young. You're buying shares on sale. The market has recovered from every crash in history—and you have decades to ride it out.

The Perfect Investing Setup for Students & Young Canadians

No Minimum Investment

Wealthsimple lets you start with any amount. Got $20? Invest $20. Got $5 left over after coffee? Invest $5. Every dollar counts.

Fractional Shares

XEQT costs ~$27/share, but you can buy $10 worth. Fractional shares mean 100% of your money gets invested, not left sitting as cash.

$0 Commissions

Banks charge $9.95 per trade. If you invest $50/month, that's 20% lost to fees. Wealthsimple? $0. Every cent goes into your portfolio.

Tax-Free TFSA

All your investment growth in a TFSA is tax-free. Starting young means decades of tax-free compounding—potentially hundreds of thousands in avoided taxes.

Automatic Investing

Set up $25/week or $100/month to auto-invest. You won't even notice it leaving your account, but you'll notice it growing over time.

Simple Strategy

One ETF (XEQT), one account (TFSA), automatic contributions. No stock picking, no research, no stress. Set it and forget it.

Your Future Self Will Thank You

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The Student-Friendly Investment Strategy

Here’s the exact approach for students and young investors:

The "Set and Forget" Strategy

  • Step 1: Open a TFSA on Wealthsimple — It's free, takes 5 minutes, and you get $25 to start.
  • Step 2: Set up automatic deposits — Even $25/week or $50/month. Link it to your payday so it happens automatically.
  • Step 3: Buy XEQT — One fund, 12,000+ global stocks, automatic rebalancing. That's it.
  • Step 4: Don't touch it — Seriously. Don't check it daily. Don't panic when markets dip. Let time do its thing.

Total time commitment: 10 minutes to set up, 0 minutes per month after that.

What is XEQT?

XEQT is a single ETF that holds:

When you buy XEQT, you instantly own a tiny piece of over 12,000 companies worldwide. It automatically stays balanced, so you never need to rebalance or manage anything.

Cost: 0.20% per year (that’s $2 per $1,000 invested)

Learn more about XEQT for beginners.

Why XEQT for young investors? At your age, you want maximum growth. XEQT is 100% stocks—higher risk, but higher expected returns over long periods. You have 40+ years to ride out any volatility.

Finding Money to Invest (Even on a Student Budget)

Where to Find $50/Month

You don't need to make big sacrifices. Here are some realistic ways to find investing money:

  • Skip one food delivery per week — Save ~$15-20/week = $60-80/month
  • Make coffee at home 2x/week instead of buying — Save ~$40/month
  • Cancel one unused subscription — $10-15/month
  • Sell something you don't use on Facebook Marketplace — One-time boost
  • Round up purchases — Wealthsimple's roundup feature invests your spare change
  • Put gift money to work — Birthday cash can become retirement cash

The key insight: You're not "losing" this money. You're paying your future self first.

That $5 coffee today could be worth $40+ by the time you retire. Choose wisely.

Why Wealthsimple is Perfect for Students

Banks are terrible for young investors. High fees, high minimums, complicated platforms. Wealthsimple was built differently.

Why 3 Million+ Canadians Use Wealthsimple

Wealthsimple is the go-to platform for young Canadian investors. Here's why:

$0 Commissions Buy and sell without fees
$0 Minimum Start with literally any amount
Fractional Shares Invest every dollar
5-Minute Setup All from your phone
Roundups Invest spare change automatically
Student-Friendly No judgment, no minimums

Compare that to banks: $9.95/trade, $1,000+ minimums, and boring boomer interfaces. Wealthsimple understands that your generation invests differently.

Learn more about why Wealthsimple is the best platform for Canadians.

Start Investing in 5 Minutes

  1. Click Our Referral Link
    Use this link to sign up for Wealthsimple. You'll get $25 towards your first investment—free money to start your portfolio.
  2. Open a TFSA
    If you're 18+, choose Tax-Free Savings Account. All your gains will be tax-free forever.
  3. Verify Your Identity
    Quick photo of your ID (driver's license or passport). Takes 2 minutes.
  4. Link Your Bank & Deposit
    Connect your bank account. Start with whatever you can—$20, $50, $100. Every dollar counts.
  5. Buy XEQT & Set Up Auto-Invest
    Search "XEQT", buy with your deposit + $25 bonus. Then set up automatic weekly or monthly investments.

Congratulations—you're now an investor. Your future self just got a lot wealthier.

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Student Investing Tips

What About Student Loans?

Here’s the math:

The TFSA is key here—your gains are tax-free, which often beats paying down low-interest debt.

TFSA vs RRSP for Young Investors

Start with TFSA. Period.

Your TFSA contribution room is $7,000/year in 2025, and unused room carries forward. Even if you can only invest $1,000/year now, you’re building the habit.

What If I Need the Money?

That’s the beauty of a TFSA—you can withdraw anytime without penalty. But here’s the mindset shift:

Don’t invest money you’ll need in the next 1-2 years. But money you won’t need for 5+ years? Get it invested.

The Real Risk: The biggest risk for young investors isn't a market crash—it's not investing at all. Every year you wait is a year of compound growth you can never get back.

Frequently Asked Questions

Can I invest if I'm under 18?

You can't open your own TFSA until 18 (or 19 in some provinces). But your parents can open an informal trust account for you, or you can start researching and saving until you're eligible. On your 18th birthday, open that TFSA immediately.

How much should I invest as a student?

Whatever you can consistently afford. $25/month is a great start. $50/month is better. $100/month is amazing. The amount matters less than the consistency. Start where you are and increase it when you can.

What if I need to stop investing temporarily?

That's fine—life happens. The key is to restart as soon as you can. Your existing investments will keep growing even if you pause contributions. Just don't sell during a downturn.

Should I invest or build an emergency fund first?

Build a small emergency fund first ($1,000-2,000 in a savings account), then start investing. You don't need a full 6-month emergency fund before investing—that could take years. A small buffer plus invested money is better than a huge cash pile earning nothing.

Is XEQT too risky for beginners?

XEQT is 100% stocks, which is volatile in the short term. But for young investors with 20-40 years until retirement, that "risk" is actually your friend—stocks have the highest long-term returns. You have time to ride out any dips.

What's the difference between saving and investing?

Saving = putting money in a bank account (safe but low returns, ~2-4%). Investing = buying assets like XEQT that grow over time (higher returns, ~7% average, but with short-term ups and downs). For money you won't need for 5+ years, investing wins.

How do I not panic when markets drop?

Remember: drops are sales. When XEQT goes down 20%, you're buying the same companies at a 20% discount. Young investors should celebrate crashes—you're accumulating shares at lower prices. Every historical crash has been followed by recovery and new highs.

Can I lose all my money?

With XEQT, you'd need 12,000+ companies worldwide to go bankrupt simultaneously. That's never happened in market history. Individual stocks can go to zero. Diversified index funds like XEQT essentially cannot—though they can (and will) temporarily drop during recessions.

Your Wealth-Building Journey Starts Now

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The Bottom Line

You have something that billionaires would pay anything for: time.

Every year you delay investing costs you potentially tens of thousands of dollars in future wealth. The student who invests $100/month starting at 20 will likely retire wealthier than the professional who invests $300/month starting at 35.

The strategy is embarrassingly simple:

  1. Open a TFSA on Wealthsimple (get $25 free)
  2. Set up automatic investments (even $25/week)
  3. Buy XEQT and don’t touch it
  4. Let compound growth do the work for 40+ years

No fancy strategies. No stock picking. No financial advisor fees. Just time and consistency.

The best time to start investing was yesterday. The second best time is today.

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