Investing for Kids Calculator
Money invested during childhood has decades to compound. This shows what a monthly amount reaches by the time contributions stop — and what it becomes by 65 if it is never touched again.
The number that surprises people
Look at "growth after contributions stop". In most scenarios it dwarfs everything actually contributed. Nothing is added after age 18 — the entire remainder is the original contributions compounding for another 47 years.
That is the whole argument for starting early, and it is why the same total contributed at 35 produces so much less. Time in the market is doing more work than the amount.
Start age, holding everything else constant
Same monthly amount, same assumed return, all stopping at age 18. Only the start age changes.
| Start age | Contributed | At age 18 | At 65 |
|---|---|---|---|
| 0 | $10,800 | $19,368 | $299,539 |
| 2 | $9,600 | $16,055 | $248,299 |
| 4 | $8,400 | $13,115 | $202,839 |
| 6 | $7,200 | $10,508 | $162,508 |
| 8 | $6,000 | $8,194 | $126,727 |
| 10 | $4,800 | $6,141 | $94,983 |
| 12 | $3,600 | $4,320 | $66,820 |
| 14 | $2,400 | $2,705 | $41,834 |
| 16 | $1,200 | $1,272 | $19,666 |
How money actually gets invested for a child
A child cannot open a brokerage account alone. The common structures in the US are:
- Custodial account (UTMA/UGMA). An adult manages it; the assets legally belong to the child and transfer to their control at the age of majority, which varies by state. Gains are taxable, and because the money is the child's it can affect financial aid calculations.
- Custodial Roth IRA. Only available if the child has earned income, and contributions cannot exceed what they actually earned that year.
- 529 plan. Tax-advantaged but intended for education costs; non-qualified withdrawals are penalised.
- Your own account, earmarked mentally. Simplest, stays under your control, but has no tax advantages.
These differ meaningfully in tax treatment, control and financial-aid impact, and the right one depends on circumstances this page knows nothing about. Talk to someone qualified before choosing.
For how the tax on a custodial account actually works — the 2026 kiddie tax tiers, and the balance at which each one starts to bite — see the custodial account tax calculator.
Teaching it before doing it
The concept lands better with a balance a child can watch than with a projection to 65. See how to explain compound interest to a kid, or model shorter timescales with the compound interest calculator and the savings by 18 calculator.
Bank of Dad also has a practice investing feature — kids can track holdings with real market prices and no real money at stake.
Frequently asked questions
Can I open an investment account for my child?
Not in their name alone. In the US the usual routes are a custodial account (UTMA/UGMA) that you manage until they reach the age of majority, a custodial Roth IRA if they have earned income, or a 529 plan for education costs. Each differs in tax treatment and in how it affects financial aid.
What return should I assume?
There is no correct answer, which is why this calculator does not pick one for you. Long-run averages for broad stock indexes are frequently quoted, but no investment delivers a constant return and past averages do not predict future results. A more useful exercise is to run several values and look at the spread rather than trusting any single figure.
What happens to a custodial account when my child turns 18?
With a UTMA or UGMA, control transfers to the child at the age of majority in their state — which is 18 in some states and 21 in others — and at that point they can do whatever they like with it. That is worth knowing before choosing this structure.
Does this account for inflation and taxes?
No. Every figure is nominal, before fees and taxes. A balance shown for fifty years from now would buy substantially less than the same number would buy today. Treat the output as illustrating how compounding behaves, not as a forecast of purchasing power.