Investing Basics · 5 min read · June 22, 2026

Custodial Accounts for Kids

A custodial account gives a child real ownership and decades of compounding. Why getting kids to contribute, even small amounts, teaches lessons no lecture can match.

A custodial account can be one of the most powerful gifts you give a child because it combines real ownership with the magic of long term compounding. When the child actually helps contribute to that account, the benefits multiply far beyond just the dollars saved.

A custodial account typically means a UTMA or UGMA brokerage account set up in the child's name but managed by a parent or guardian until the child reaches the age of majority. In California that age is usually eighteen. The money legally belongs to the child, but you control the investments while they are young. This setup lets you start building wealth for their future right away, whether that future means college, a first home, or simply a strong financial foundation.

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