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The Schwab One ® Custodial Account is a brokerage account that allows you to make a financial gift to a minor and help teach them about investing. It is set up and managed by an adult, and turned over to the child when he or she reaches the age of majority.
A custodial account can be a way to teach a minor about investing while they're young, with the ability to make withdrawals at any time, as long as they are used to directly benefit the minor. The process can take as little as 10 minutes, but before you begin, make sure you have your social security number or tax identification number.
Transferring a Custodial Account. Under the laws that govern custodial accounts, including the Uniform Transfers to Minors Act (UTMA), account custodianship ends and the beneficiary becomes eligible to assume control of the account at a specified age—typically 18 or 21, depending on the state.
With a custodial account, you can explain that the money belongs to the child and that you are investing it for him or her. By showing a child the investment mix, types of assets, and performance reports, you can educate him or her about investing.
From Fidelity, Schwab, Vanguard, M1 and others, Forbes Advisor has identified the best custodial accounts on the market today.
Teach your child about investing–Consider a Schwab One® custodial account, which allows you to give money to a child for any purpose while enjoying some tax advantages. Or open a Custodial IRA to give a teen with earned income a head start on saving for retirement.
Learn some custodial account dos and don'ts. A custodial IRA —If a child works and has earned income, he or she may be eligible for a custodial IRA. This account is also managed by a parent or guardian for the benefit of the child.
The Schwab One Custodial Account offers the same key features as the company’s flagship Schwab One Brokerage Account: Zero commissions for buying and selling stocks and ETFs, no minimum...
A custodial account allows you to manage an investment portfolio for the benefit of your child. When you open a Schwab custodial account on behalf of a minor, it functions similarly to a...
If you want to set aside money for college expenses that aren't covered by an Education Savings Account (ESA) or 529 plan, a custodial account might help. The benefits : You can take advantage of the gift tax exclusion to fund the account.