Should You Open A Custodial Account For Your Kid?
- By
Julia Austin
Source: andresr / Getty
It can help with home down payments
In my case, the funds from my custodial account are helping my partner and I purchase our first home. My father, being a smart money man, decided to borrow money for my college education rather than use my custodial funds because he was able to borrow money at a lower rate than the funds were earning interest. So, in other words, he was actually able to still come out on top by borrowing the money for school. My student loans came at an interest rate of around three percent but my custodial fund were earning interest at just shy of six percent. See the difference? Now I’m using those funds that continued to grow to purchase a home.
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