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A custodial account is a popular way for parents and guardians to invest for their children’s future. Accounts are easy to set up and manage, and the adult custodian can choose from a wide range ...
A custodial account is an account that parents can set up and manage on their minor child’s behalf, and the child is able to take over the account upon becoming a legal adult.
Here’s how custodial accounts work.
Custodial accounts come in a number of forms, one being an account set up for a minor, since the minor is under the legal age of majority. The custodian is often the minor's parent. In the U.S., this type of account is often structured as a Coverdell ESA, allowing for tax-advantaged
The Uniform Gifts to Minors Act (UGMA) is an act in some states of the United States that allows assets such as securities, where the donor has given up all possession and control, to be held in the custodian's name for the benefit of the minor without an attorney needing to set up a special trust fund. This allows a minor in the United States ...
Minors usually need an adult to open an account Teens under age 18 will likely need a parent or guardian to open a savings account. This adult will be designated as a joint account holder .
Typically the obligor is a non-custodial parent. [citation needed] Typically the obligee is a custodial parent, caregiver or guardian, or a government agency, and does not have to spend the money on the child. In the U.S., there is no gender requirement for child support; for example, a father may pay a mother or a mother may pay a father.
Continue reading → The post Best Custodial Accounts in 2021 appeared first on SmartAsset Blog. Usually these types of accounts are set up by a parent, relative or guardian on behalf of a family ...