Joseph F. Hurley, a CPA and author of The Best Way to Save for College , said the programs are not just hype, although the hype is driving the wave of investments.
Investors usually receive a break on state and federal taxes on the earnings of such funds.
The UTMA allows parents to open an account in the name of a minor and act as the adult custodian, controlling access to the money and deciding where it's invested. Filippi said it's similar to a children's savings account or trust fund. The account is attached to the minor's Social Security number. It's a great savings vehicle. Regardless if the child goes to college, when he grows up he's gonna need a car, or a band trip to Washington, D.C., or braces.