How to Open a Brokerage Account for a Minor

Opening an investing account on behalf of your minor can be a great way to teach your kids about the value of money and money management.

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Yes, your child can become an investor. You can open a brokerage account called a custodial account for a minor, but retain control of it. And when your child reaches the age of maturity, your child can take over the account. But by learning the value of a dollar, saving and investing early on, your child can already be on the path to proper money management and financial wellness.

And you have different types of accounts to choose from a variety of brokerage firms that may offer different investment options, competitive fees, and access to human financial advisers. So let’s explore your options.

Uniform Transfers to Minors Act (UTMA) Accounts

The Uniform Transfers to Minors Act (UTMA) accounts are designed to hold a variety of investment options. These may include traditional and alternative investments, such as:

• stocks
• bonds
• mutual funds
• exchange-traded funds (ETFs)
• target-date funds (TDFs)
• precious metals (gold, silver, etc.)
• real estate
• works of art

A UTMA account is relatively straightforward. You open an account through a brokerage firm and manage the investments. The assets technically belong to the minor. But they can’t access these until they reach the legal age of maturity. That’s usually age 18 or 21, depending on the state. You have a fiduciary duty to manage the account for the benefit of the minor.