California has once again set a precedent in the entertainment industry by taking bold action to protect its youngest content creators. In September 2024, Governor Gavin Newsom signed two new bills that expand protections for child influencers and online content creators. This legislation is an important move to prevent financial exploitation and ensure that children who earn money through social media are safeguarded.

California’s approach follows Illinois, which passed similar legislation earlier this year. Together, these states are acknowledging the growing number of minors who generate income through online platforms like YouTube, TikTok, and Instagram. As more children enter the digital space as influencers, it’s crucial to have clear guidelines and legal protections in place.
What Does the New Law Include?
The legislation introduces several key measures designed to protect minors featured in monetized online content:
- Mandatory Trust Accounts for Earnings:
- Parents or guardians must place 15% of a child’s earnings into a trust account. The child can only access this money when they turn 18. This provision ensures that young content creators have a secure financial safety net for their future.
- Expanding the Coogan Law to Cover Digital Content:
- The Coogan Law, originally designed to protect child actors in Hollywood, now applies to child influencers as well. This amendment recognizes that online platforms are a new form of media where children’s work should be equally protected.
- Increased Financial Oversight:
- Earnings from social media must be properly managed and allocated. This oversight prevents parents from misusing or spending the money meant for their children’s benefit.
Why Was This Legislation Needed?
The rise of social media has created a new type of child performer—one who doesn’t appear on TV or in films but on their parents’ YouTube channels or TikTok accounts. Children as young as five are now starring in monetized content, sometimes generating millions of dollars through sponsorship deals and advertisements. However, the legal protections for these young influencers have been vague, leaving them vulnerable.
Addressing “Sharenting” and Exploitation
Many parents share their children’s lives online to build lucrative businesses. This practice, known as “sharenting,” can lead to significant privacy concerns and financial risks for the children involved. Some parents may not save the earnings for their kids, treating the income as family revenue instead.
The Historical Context: The Coogan Law’s Origin
The Coogan Law was named after child actor Jackie Coogan, who lost nearly all his earnings due to parental mismanagement. In the 1930s, his case revealed the urgent need for laws to protect young performers’ financial interests. California’s new law draws on this legacy, adapting it to fit the digital age.
Real-World Example: Ethan’s Story
Ethan, a 10-year-old YouTube star, runs the channel “Ethan’s Toy Box.” With over 2 million subscribers, he reviews and unboxes the latest toys and gadgets for children. Each video Ethan produces can earn between $10,000 and $30,000 through sponsorships and affiliate links. Brands pay his family to showcase their products because Ethan’s reviews influence purchasing decisions.
Without proper safeguards, Ethan’s financial future could be at risk. Before this law, his parents had no legal obligation to save his earnings. They could use the money for household expenses or other purposes, leaving Ethan without access to the wealth he worked hard to generate. Now, the new law ensures that 15% of Ethan’s earnings are secured in a trust account. This protection guarantees that Ethan will have funds available when he becomes an adult, regardless of how his parents choose to manage the rest of his income.
The Impact on Child Influencers and Their Families
This legislation will significantly affect families that depend on child influencers’ earnings. Here’s what the changes mean:
- Financial Security for Young Influencers:
- By placing earnings into a trust, children are assured of having funds when they turn 18. This rule helps prevent parents from misusing the money or using it solely for household expenses.
- Shifting Family Dynamics:
- Parents must now consider their children’s rights and well-being more seriously. Earnings are no longer “family money” but a resource that belongs to the child.
- Setting a National Standard:
- California often sets trends for other states. As awareness of this issue grows, more states may adopt similar laws. Protecting children’s financial rights is likely to become a nationwide standard.
- Promoting Ethical Practices in Content Creation:
- By holding families accountable, the law encourages ethical practices. Parents will need to think twice before placing children in content solely for profit.
Looking Ahead: Why This is a Positive Step
While some argue that government intervention in family finances overreaches, the new law is about protecting children from financial exploitation. Placing earnings in trust empowers young influencers by giving them access to their earnings in the future.
In the digital era, children can become public figures before they even understand the concept of money. This law is a crucial response to these challenges, ensuring that child influencers receive the financial protection they deserve. It’s a commendable step that prioritizes the best interests of minors in the rapidly evolving world of digital content creation.
As more children step into the spotlight online, California’s law serves as a model for how we can safeguard their financial futures. It’s a thoughtful response to a complex issue, demonstrating that even in the digital age, children’s rights must come first.
Sorry, comments are closed for this post.