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Hi Dudeman95,

To add to the other great input you have already been given...

First off, what does your kids think?

Then, you need to consider how soon they will they need it. If they will need it soon (3 years or so), then the regular rule applies that cash is the only way protect the principal. So, yes, the savings account or cd making not much.

As others have said, kids money needs to stay kids money. But, if they are a minor then an adult will have to be a co-owner on a savings account or it can be a brokerage UGTMA with it converting to the minor when they turn 18.

I started UGTMA accounts for both of my kids when they were first born to ensure that they could afford to go to college when the time came. When they got old enough to have money "of their own" they wanted it in a separate account. The oldest did a really nice job selecting a few companies three years ago. The younger one isn't as interested in investing, but has indicated an interest in an account of her own (she turns 18 on Monday).

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