Introduction
Investing has become more accessible than ever before, thanks to numerous investing apps available on the market. With a few clicks, you can start investing in stocks, bonds, or ETFs. However, for parents who want to start investing for their children, it can be a bit tricky. Fortunately, investing apps with custodial accounts make it possible for parents to invest for their children. In this article, we will explore the best investing apps with custodial accounts.
What is a Custodial Account?
A custodial account is a financial account that parents can open on behalf of their children. Parents can manage the account and invest in stocks, bonds, and other assets until the child reaches the age of majority. Once the child reaches the age of majority, the account ownership will transfer to the child, and they can manage the account on their own.
Benefits of Custodial Accounts
Custodial accounts offer numerous benefits for parents who want to invest for their children. First, it allows parents to invest in the stock market without having to set up a trust or other legal structure. Second, it provides an excellent opportunity for parents to teach their children about investing and financial responsibility. Third, it provides tax benefits, as the account is taxed at the child’s tax rate, which is usually lower than the parents’ tax rate.
Best Investing Apps with Custodial Accounts
Now, let’s take a look at the best investing apps with custodial accounts.
1. Robinhood
Robinhood is a popular investing app that offers a custodial account option. The app provides commission-free trading and allows parents to invest in stocks, ETFs, and options.
2. Acorns
Acorns is another investing app that offers a custodial account option. The app invests your money in low-cost ETFs and automatically rebalances your portfolio.
3. Stash
Stash is an investing app that offers a custodial account option. The app allows parents to invest in fractional shares of stocks and ETFs and provides investment guidance.
How to Choose the Right Investing App with Custodial Accounts
Choosing the right investing app with custodial accounts can be overwhelming, but here are some tips to help you make the right decision.
1. Fees
Look for an app that charges low fees or no fees for custodial accounts. You don’t want the fees to eat into your investment returns.
2. Investment Options
Choose an app that offers a wide range of investment options, including stocks, bonds, ETFs, and mutual funds.
3. User-Friendly Interface
Choose an app that has a user-friendly interface and easy-to-use features. You want an app that you can navigate easily and quickly.
Conclusion
Investing apps with custodial accounts have made it easy for parents to invest for their children. With the right app, parents can take advantage of the benefits of investing while teaching their children about financial responsibility. Choose the right investing app with custodial accounts by looking for low fees, a wide range of investment options, and a user-friendly interface.
