TMI: Peyton’s Journey from Client to Colleague

Peyton, being one of our youngest investors, began her journey as Renee’s client when she was 12 years old. Peyton is part of the Durham FFA and each year she raises and sells her hog at the fair. Rather than putting the annual sales into a checking or savings account, she wanted to open an investment account to allow it to grow and compound over time.

When opening an account for a minor, there is typically one of three ways to go -

· 529 College Savings Plan

· Custodial Brokerage Account (UGMA/UTMA)

· Or Custodial Roth IRAs

Renee helped Peyton and her mom carefully consider each account, and ultimately, they landed on opening a Uniform Transfers to Minors Act (UTMA) custodial account. Without the cost or complexity of a trust, UTMAs are taxable investment accounts that allow families to save and invest money on behalf of a child with no contribution limits. Between the ages of 18 and 25 (the default age in California is 18) Peyton will be granted legal control of the account, allowing her to use the money for anything she would like – college, down payment on a home, backpacking across Europe, you name it.

Since having a UTMA, Peyton has really enjoyed having a better understanding of her money and financial habits, along with seeing her investment grow (who doesn’t).

Peyton, a client of 4 years now, will be joining us as a colleague for the summer. She is incredibly hard-working, kind and we are so grateful for the extra set of helping hands. Make sure to give her a warm welcome next time you stop by or call in.