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My parents want to give my new baby some money for a savings account. However, if its just going to sit there for 20 years, I'd prefer for it to gain interest/dividends. Is there any easy way to setup a fund that tracks s&p500 and preferably tax advantaged? Or am I better off just investing in the relevant mutual fund.

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[-] Steve@communick.news 7 points 5 days ago* (last edited 5 days ago)

UGMA or UTMA is probably what you're looking for.
You should talk to a tax pro, to be sure.

[-] Fermion@mander.xyz 3 points 5 days ago* (last edited 5 days ago)

There's also 529 accounts for education/vocational training programs. Each state runs their own program. Some will exempt contributions from state income tax. I think the big brokerages all use Nevada for their 529 accounts. Gains are tax free if used for qualifying educational expenses. Non-qualifying withdrawals incur something like a 15% penalty and are taxable. The definition of qualifying expenses is fairly liberal though, things like rent and laptop purchases qualify if attending school full time. Unused funds can be transferred to just about any relative.

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this post was submitted on 06 Dec 2025
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