Where to invest money sent to me for birth of my daughter?

Question

I have money that was given to my daughter on her birth. I want to invest it for her so it can begin to earn money now and not set up a savings account for her. I have a well rounded portfolio myself- TSP, mutual funds, stocks for my retirement. I"m not sure I want to set up a college fund for her. But I want the money to grow so she could use it for college if she wants or for it to be the basis of a retirement fund for her. Is there a benefit to put it in my name v. her?

Answer 1

To my mind the best way to invest money is to invest in someone's business. It's safer and more profitable. I have invested in good business and now I am getting guaranteed 40% annual interest.

Note: I don't need your money but you may contact me for a good advice.

I wish you success in your investments!

Answer 2

The benefit of NOT putting the money into her name alone is that when she turns 18, she cannot take the money and buy a car.  If you put the money into her name then when she is 18 she can take the money and do as she pleases with it.

Answer 3

There is a practical consideration to putting your daughter on the account.  She will not be able to sign to withdraw as a minor.  

You may want to set up a custodial account at your bank for your child until you decide where to invest the money.  You could perhaps do a monthly draw to a mutual fund.

A current idea is to buy a value mutual fund.  Some of the companies I have bought mutual funds from are Fidelity, Vanguard, T. Rowe Price.

Answer 4

Well the best thing is find a financial advisor if you don't have one sit down with him and look at all the different options available to you. Then you can deside what is best especially if you just want it to sit or if you want to continusly place money into the account

Answer 5

I think the 529 education fund is still the best because it is tax deferred. And you can use some of the money for school expenses, even a computer over the years, not just for college. Plus by paying a penalty you can pull the money out I think.

The biggest benefit of "retirement" savings is the tax deferral. But she has to have earned income to get that benefit.

You really can't get tax deferred retirement savings for her. She has to have that earned income.

If you want to support her for retirement when she is older you could give her money when starting out in return for her putting her income in an IRA or 401(k).  Starting out it is very hard to save, we all need all our money at that point. But that is when we enjoy the long term tax free compounding benefit the most. But most can't do it.