Hi everyone! I would like to start investing into an account for our child’s future. Whether that be for higher education, a down payment on a house, or other general living expenses, we’d like her to have a head start in life.
She’s one year old now and we’re located in Washington state. I’ve heard of Roth IRAs and just normal high yielding savings accounts, but I don’t know enough information to determine which one would be the best.
What type of account would you recommend that has a high yielding interest rate but the money could be used for anything?
Best Investment Account for a Child
byu/honeybeez8328 inpersonalfinance
Posted by honeybeez8328
3 Comments
529 Plan if you’re thinking of their college. Roth IRA is a retirement account, hence the Individual Retirement Account portion of the name
529 for education.
Your daughter would need earned income to contribute to a Roth IRA.
You are probably looking for a UTMA or UGMA acct, you can do a search. Open in a brokerage (I’d suggest Vanguard, Schwab, or Fidelity) and invest it however you like, you manage it in the interest of your child, at age 18 or 21, it’ll go to the child.
You cannot open a Roth IRA or any type of IRA acct for a 1yr old, those accts need the person to have income from working. You can just do a simple search.