What do I need to look for in a savings account or investment for 3 yr old?
I bank with Bank of America and they offer a custodial savings account. I like this option because I can transfer money each week from my checking account to this account. I don’t understand about why they report interest rate to child’s credit report. Any help there would be great. Also are there any other investments I can start besides the savings account that requires small amount of money up front for my three yr old then also start for my 1 yr old.
Thanks
The reason why they report the interest rate to the credit bureaus is the amount of money you earn factors into calculating your credit score. So, the amount of interest you earn is used to calculate that score.
If you don’t like that, why don’t you just start a savings account in your own name and transfer it to your kid when he/she turns 18? If it is too big with too much money, you may have to pay a gift tax, though.
SEED: Families Saving Together