Best Custodial Savings Accounts (UGMA/UTMA)
A custodial account holds money that legally belongs to a child, with an adult managing it until the child comes of age. If you haven't read how they work, start with UGMA and UTMA custodial accounts, explained. It covers the tax rules and the financial aid catch.
This page is about where to open one.
Checked September 23, 2026.
First: many "kids savings" accounts aren't custodial
Plenty of banks advertise savings accounts for children, and most are joint accounts shared by a parent and child. That's a different thing:
| Joint kids' savings | Custodial (UTMA/UGMA) | |
| Who owns the money | Both of you | The child, permanently |
| Can the parent take it back | Yes | No, the gift is irrevocable |
| Taxed to | Usually the parent | The child ("kiddie tax" rules) |
| Child controls it at 18–21 | No, not automatically | Yes |
If you want a savings account the parent controls, a joint kids' account is simpler. Choose a custodial account when you specifically want the money to be the child's, for example gifts from grandparents that you want kept separate.
Where custodial accounts are offered
Credit unions and community banks. This is where custodial savings accounts are most common. Many offer UTMA savings accounts and CDs, often with no minimum. Digital Federal Credit Union (DCU), for example, lets members open a UTMA as either a savings or a checking account. Rules vary: some community banks only open custodial accounts in a branch, and some limit them to savings and CDs.
Brokerages. Fidelity, Charles Schwab, Vanguard and J.P. Morgan all offer custodial brokerage accounts. Fidelity's custodial account has no minimum opening deposit and no ongoing fees. A brokerage custodial account can still hold cash in a money market fund, and it can also hold index funds if you're saving for 10 years or more.
Large online banks. Few of the big online savings banks offer UTMA or UGMA savings accounts. Check the bank's account types before assuming.
Savings, CD or brokerage?
| The money is for… | Consider |
| Within 5 years (a first car, a gap year) | A custodial savings account or CD at a credit union |
| A known date (graduation) | A custodial CD, or a CD ladder |
| 10+ years away | A custodial brokerage account with a broad index fund |
| College specifically | A parent-owned 529 plan instead. It has less effect on financial aid, and the parent keeps control |
What to check before opening
- Minimum deposit and monthly fees. Many custodial accounts have neither.
- Online access. Some community banks only let you open a custodial account in a branch.
- The age of transfer. It's set by your state, usually 18 or 21, and later in a few states. Some banks list it.
- Successor custodian. Name one, so someone can take over if you can't.
- The rate. Custodial savings rates at credit unions are often lower than top online HYSAs. Compare.
Opening one
You'll need the child's full name, date of birth and Social Security number, plus your own ID. Deposits count as gifts to the child. Gifts under the annual exclusion don't require any tax filing. See how to legally gift money tax-free.
FAQ
Can a teen use a custodial account themselves? Not until they reach the transfer age. For a teen who wants their own card and account now, see bank accounts for teens or the best stock apps for teens.
Can I have both a custodial account and a 529? Yes, and many families do. The college savings calculator helps size the 529 part.
Can I open one for a child who isn't mine? Yes. Grandparents, aunts, uncles and family friends can all open custodial accounts.
Figures and rules in this article are checked against the official sources below. Where they disagree with us, they win.
- Chase/J.P. Morgan UTMA page
- DCU UTMA page
- First Command UTMA/UGMA page
- Ridgewood Savings Bank and Home Bank custodial pages
- Bankrate and NerdWallet custodial brokerage reviews (2026)
