Custodial Account at Truist Financial — Secure, Flexible Savings and Investing for a Child’s Future

The Custodial Account at Truist Financial offers a straightforward, responsible way for parents, grandparents, and other adults to save and invest on behalf of a minor. Designed to combine clear legal structure with flexible funding and investment choices, a custodial account enables a custodian to manage assets for a beneficiary until they reach the age specified by state law. Whether the goal is to build a college nest egg, provide for a first car, or create a financial foundation for future independence, a Truist custodial account provides the tools and account features to support long-term goals.

What a Custodial Account Is

A custodial account is a legal arrangement in which an adult (the custodian) holds and manages assets for the benefit of a minor (the beneficiary). The custodian has the authority and responsibility to make investment, withdrawal, and management decisions in the best interest of the child. Ownership of the assets is considered the beneficiary’s for tax and legal purposes, but the minor cannot control or withdraw the assets until reaching the age of majority defined by state law.

Key Features

• Flexible funding: Cash, checks, transfers, and in many cases investment transfers can be used to fund the account. Gifts from family and friends can consolidate into one purpose-driven account.
• Investment options: Depending on the chosen account type and platform, custodial accounts can offer access to a range of investment choices including managed portfolios, mutual funds, ETFs, and deposit products.
• Clear legal framework: Accounts are established under state custodial law (commonly UGMA or UTMA or equivalent), with the custodian acting under a fiduciary duty to the beneficiary.
• Online access and tools: Digital banking and investment tools allow custodians to monitor performance, set recurring contributions, and access statements and tax documents.
• Transfer at maturity: When the beneficiary reaches the age specified by state law, control transfers to them and the account becomes their property.

Benefits of Choosing a Custodial Account at Truist Financial

• Simplicity: Set up with straightforward documentation and minimal administrative complexity compared with some trust vehicles.
• Educational focus: A practical way to save for school-related expenses as well as a wide range of other uses that benefit the child.
• Potential tax advantages: Income and gains may be taxed at the child’s rate up to certain thresholds, which can mean lower overall tax compared with assets held in an adult’s name. Standard income and gift tax rules apply.
• Financial literacy opportunity: Custodians can involve the beneficiary in age-appropriate conversations about saving and investing, building useful skills for adulthood.
• Integrated financial services: Access to both banking and investment capabilities makes it easy to combine deposit protection for cash components and diversified investments for long-term growth.

How It Works — Roles and Responsibilities

• Custodian: The adult who opens and manages the account. The custodian invests, monitors, and makes withdrawals only for the benefit of the minor. The custodian’s duty is fiduciary in nature.
• Beneficiary: The minor child who legally owns the account assets. The beneficiary gains full control at the age specified by state law.
• Truist Financial: Provides account administration, transaction processing, documentation, online access, and reporting. The institution facilitates compliance with applicable regulations and tax reporting requirements.

Tax and Reporting Considerations

Custodial accounts are generally taxable to the beneficiary, and tax reporting is handled according to prevailing tax laws. Earnings and investment income may be taxed at the child’s rate, though special rules can apply. Annual statements and any necessary tax forms are provided so custodians can meet filing obligations. Gifts to a custodial account may be subject to gift tax rules and annual exclusion limits; careful planning can help optimize tax outcomes.

Funding, Contributions, and Withdrawals

Contributions to a custodial account are typically considered irrevocable gifts to the beneficiary. Custodians can make one-time or recurring contributions. Withdrawals must be used for the benefit of the child — expenses such as education, healthcare, basic living costs, and enrichment activities are common examples. Once the beneficiary reaches the age designated by state law, they can use the funds for any lawful purpose.

Considerations When Choosing a Custodial Account

• State law age of transfer: The age at which the beneficiary gains control varies by state; confirm the applicable age before opening the account.
• Financial aid impact: Custodial assets are considered the student’s assets for financial aid calculations and can influence eligibility.
• Irrevocability: Contributions are typically irrevocable gifts; the custodian cannot reclaim funds for personal use.
• Fees and investment choices: Review account fees and the range of available investments to align with your goals and risk tolerance.

Security and Protections

Truist Financial provides account security, regulatory oversight, and established operational controls. Deposit balances held in bank products are subject to federal deposit insurance limits where applicable. Investment accounts may be covered by protections designed for securities accounts; custodians should review the account terms and protections relevant to the selected products.

Getting Started

Opening a custodial account typically involves verifying identities for both custodian and beneficiary, completing account paperwork designating the custodian and beneficiary, selecting funding methods, and choosing investment options. Custodians may opt for a hands-on approach or select managed options to align investment strategy with time horizon and risk tolerance.

Summary

A Custodial Account at Truist Financial is an accessible, legally established vehicle to save and invest for a child’s future. By combining flexible funding, a range of investment choices, and institutional support, it enables families to build assets, teach financial responsibility, and prepare for the milestones ahead. Thoughtful use of a custodial account can be a core element of a broader financial plan that supports education, personal development, and long-term security for a beneficiary.

Address Bank: Truist Center, Charlotte, North Carolina, U.S.
Bank: Truist Financial
Headquarters: Charlotte
Products: Deposit Accounts
Type: Custodial Account