How to Open a Child Investment Account

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Open an investment account in a child's name by making decisions about buying and selling and listing the child as the beneficiary. Consult a tax attorney about taxes on a child investment account with ideas from an investment consultant in this free video on investing.

Part of the Video Series: Investment Advice
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Video Transcript

Do you have a young son or daughter or granddaughter or grandson, and are you thinking about buying stocks for them for the long term? Hi, I'm Roger Groh with Groh Asset Management. Well, you certainly can't expect a five-year-old to identify companies that are appropriate for a portfolio for the longer term. Well, maybe you could. But generally, adults will do a better job. One of the things that you can do is you can open up an account in that child's name, but with you being the authorized person of that account. Those are called custodial accounts. What you'll need to do that at most banks or stock brokerage firms is your driver's license and, perhaps, a birth certificate of the child to prove who they are. What happens then, an account is set up. You're the only person authorized to buy or sell or do whatever is appropriate in there, and then the child is the beneficiary. Taxes? Well, that's a different matter, and you're going to have to consult your tax attorney. So I'm Roger Groh, and I hope that helps. Today, we talked about opening up custodial accounts for children.

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