Making Cents: A Child’s Garden of Investments

Parents who set up investment accounts in their children’s names can save on taxes. The first $650 of investment income for children under 14 is free of taxes, and the next $650 is taxed at only 15%. These tax savings may not sound like much, but they add up over time. A word of caution: At age 18, those for whom investment accounts have been set up take control of them--and can do what they want with the money.