What is a custodial account?

The ShareBuilder custodial account is an investment account created for the benefit of a minor. Custodial accounts are opened under the Uniform Transfer to Minors Act (UTMA), and the minor is the owner of the account and its assets. However, a custodian must manage the account until the minor reaches the age of distribution for their state of residence. Earnings (up to a certain amount) will be taxed at the minor's rate.

Note: State laws may restrict who can open a custodial account. Please consult a financial advisor for additional information on custodial account restrictions and tax reporting questions. Also, there can only be one minor and one custodian for each ShareBuilder custodial account.