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What is a UGMA account?
What is a UGMA account?
Glenda Bean avatar
Written by Glenda Bean
Updated over a week ago

A UGMA (Uniform Gifts to Minors Act) investment account is a financial tool that allows a custodian (i.e.: parent, guardian, etc.) to invest on behalf of a minor child (“minor” or “child”). It provides a way to hold and manage assets until the child reaches adulthood.

The account is held in the child's name, but the custodians have control over the investments until the child reaches the age of majority, age 18-25, depending on your state. It might offer a tax advantage by allowing the child to potentially pay lower taxes on investment gains or losses.

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