Custodial & Trust Accounts
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We can help you determine if a Trust or Custodial account is a good solution for your current financial situation. Custodial accounts are typically set up for the benefit of a minor, whereas Trusts are often established to serve the financial interests of adults. If you want to learn more, give us a call and speak to a Jovia representative today!
What's the difference between a Custodial Account and a Trust Account?
Custodial account funds are used for the benefit of a minor, although a custodian has signing authority on the account. Custodial accounts are generally set up by adults under a child’s Social Security Number. The custodian manages the funds until the child turns 18, at which time the custodian must turn the account over to the child. Custodial accounts are governed by the Uniform Gifts to Minors Act, and accordingly, there is special paperwork that must be completed upon account opening. The custodian should name a successor custodian if anything were to happen to him/her.
The purpose of many Trust accounts is to avoid probate. Trust accounts (also known as payable on death (POD) accounts) avoid probate because the asset passes to the beneficiary upon the death of the account holder. The account holders are the only persons that can withdraw funds from the account. The beneficiaries may be changed at any time by the account holder. A Trust account can have a maximum of four people on the account, including 2 signers or joint owners. Contact a Jovia Investment Services representative to learn more details.
Many types of Jovia Financial accounts can be set up as either a Custodial or Trust account relationship.