What Are the UGMA and UTMA custodial accounts?
These custodial accounts are set up with financial institutions such as banks, brokerage firms or mutual fund companies. Both the UGMA and UTMA accounts can be funded with cash, stocks and mutual funds. With these accounts, a donor (usually a parent, legal guardian or grandparent) gives the money to the trust, and the college money is then managed by a custodian on behalf of the future college student. Once the student has reached the age of majority, which varies by state, the money then belongs to the student.
