A custodial account is a financial account set up for a minor, managed by an adult, usually a parent or guardian. This account allows the adult to oversee the funds until the child reaches a certain age, typically 18 or 21, depending on state laws. The funds in the account can be used for the minor's benefit, such as education or other expenses. These accounts can hold various assets, including cash, stocks, and bonds. They are often established under the Uniform Transfers to Minors Act (UTMA) or the Uniform Gifts to Minors Act (UGMA), which provide guidelines for managing and transferring assets to minors.