The Minastany Library

Six Ways to Invest in Your Child's Future

Each account is built for a different job. Here's the whole shelf at a glance — color-coded by what it's for.

From birth Education
529 Plan
The workhorse for school savings, K–12 through college.
Contribution cap~$400k–$550k total*
Tax growthTax-free for school
Leftover fundsReassign or →Roth
From birth Education
Coverdell ESA
A flexible supplement to a 529, with wider investment choices.
Contribution cap$2,000 / yr / child
Tax growthTax-free for school
Must empty byAge 30
From birth Any purpose
Custodial (UGMA/UTMA)
A gift to the child for anything — theirs at adulthood.
Contribution capNone (gift-tax: $19k)
OwnershipChild's, irrevocably
NoteHurts financial aid
New · 2026 Retirement seed
Trump Account
New for 2026. $1,000 federal seed for kids born 2025–2028.
Contribution cap$5,000 / yr
Free seed$1,000 (not in cap)
At 18Becomes an IRA
Ages 13–17 Any purpose
Youth Investing
Hands-on, real-world investing for teens, with you alongside.
Contribution capNone
HoldsStocks, ETFs, bonds
At 18Standard brokerage
When earning Retirement
Custodial IRA
Retirement, started with a first paycheck. Roth shines here.
Contribution cap$7,500 or earnings*
RequiresEarned income
Tax growthTax-free (Roth)
For education For any purpose For retirement

*Caps are 2026 figures. 529 lifetime limits vary by state; custodial IRA limit is the lower of $7,500 or the child's earned income. Rules for newer programs can change — confirm current details before acting. This is financial education, not personalized advice.

The Minastany Library