The type of account you choose for a child will depend on your goals. If you want to give a gift of money to a minor—and at the same time introduce him to the world of investing—a custodial account could be a good choice. But if you want the money to help pay for the child's college education, the best choice will likely be a 529 college savings plan or an Education Savings Account. And if your primary objective is to transfer a large amount of wealth to a child, the best solution is probably a trust.

You should also keep in mind these estate planning considerations:

• A trust offers more flexibility, control and protection than a custodial account.
• With a custodial account, if the donor custodian dies before the child is old enough to assume responsibility for the account (usually at age 18 or 21), the assets are included in the adult’s estate and may be subject to estate tax.
• Custodial accounts don’t let you designate what happens to the money in the account if the child dies before receiving it. With a trust, however, you may make this decision.

The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. The type of accounts and strategies mentioned may not be suitable for everyone. Before establishing an account, you should carefully consider your objectives and other ways you may achieve them.