Get started today with a Fidelity account that fits the specific saving needs of you and your child or grandchild—all with no account fees or minimums to open an account.1
529 College
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Custodial Account
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Roth IRA
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Attainable Savings
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Suited for |
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Overall |
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| Build an education nest egg for a child, with tax-deferred growth and federal income tax-free withdrawals for education expenses that qualify. | Save on behalf of a child—or give a financial gift—with no contribution limit. | Invest for your child's future retirement, with tax-deferred growth and potential tax-free withdrawals. | Save and pay for qualified disability expenses, including federal income tax-free withdrawals for expenses that qualify, without potentially impacting benefits like Supplemental Security Income (SSI). |
Account control |
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| Adult controls the account for the benefit of the beneficiary (child). | Money in the account belongs to the child, with the adult acting as custodian until the child reaches a certain age (between 18 and 25, depending on the state), at which point the assets must be transferred to the child. | Money in the account belongs to the child, with the adult acting as custodian until the child reaches a certain age (between 18 and 25, depending on the state), at which point the assets must be transferred to the child. | The account owner is the eligible individual, or designated beneficiary.
If they are a minor, a person with signature authority (PSA) must be designated on the account.2 |
Child eligibility |
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| Must have a Social Security number.
A beneficiary can be any age. |
Must be younger than 18. | Must be under the age of 18 and must have employment compensation (e.g., babysitting, mowing lawns, shoveling snow, or W-2 income). | Must already be receiving benefits under Supplemental Security Income (SSI) and/or Social Security Disability Insurance (SSDI). If not, to be eligible, they must be certified blind or disabled by a licensed physician. In all cases, the disability must have begun prior to age 26. |
Contribution & gifting limits |
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| No annual contribution limits. Overall contribution cap varies by plan. Gift tax limits apply.3 | No limit on maximum contributions or gifts. Contribute up to $15,000 per individual ($30,000 for a married couple) free of gift tax in 2021. | Cannot exceed a minor's earnings; e.g., if a minor earns $1,000, then only $1,000 can be contributed to the account.
Annual maximum contribution of $6,000 per child, per year for 2020 and 2021. |
Eligible individual owns the account.
Annual contributions may not exceed the federal gift tax exclusion amount, which is $15,000 for 2021. |
Investment options |
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| 2 choices at Fidelity:
Age-based investment strategies managed by Fidelity. A custom investment mix from pre-set portfolios made up of Fidelity mutual funds, index funds, and bank deposit accounts. |
Our full range of investments, including stocks, options, mutual funds, bonds, CDs, and fractional shares. | Our full range of investments, including stocks, options, mutual funds, bonds, CDs, and fractional shares. | A range of professionally managed investment portfolios. |
Withdrawals |
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| May be taken at any time.
No federal income tax will be owed on withdrawals, including any earnings, if the money is used for qualified education expenses. |
May be taken at any time, but must be for the benefit of the minor. | No federal income tax will be owed on withdrawals of contributions, which can be taken at any time. Earnings can be withdrawn tax-free once the account has been opened for 5 years and one of the following conditions is met: child reaches age 59½, death, disability, or qualified first-time home purchase. | May be taken at any time.
No federal income tax will be owed on withdrawals, including any earnings, if the money is used for qualified disability expenses. |
Additional resources
Learn ways to explore college investment options and potential tax advantages.
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