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Investing Specialists

The Error-Proof Portfolio: Avoid These 'Investments' When Saving for Kids

If you're contributing to a child's college-savings, keep in mind that these investments are bad bets.

Although there are some immutable concepts in the realm of money and investing, such as "buy low and sell high" and "start early," the best vehicles for achieving various financial goals tend to ebb and flow over time.

That's definitely true when it comes to saving for children. While U.S. savings bonds might have been the de rigueur gift from grandma and grandpa 30 years ago, settling for their currently meager interest rates seems like a questionable bet right now. And even though UGMA/UTMA--Uniform Gift to Minors Act/Uniform Transfers to Minors Act--custodial accounts might have been one of the best options for college savings a few decades ago, the emergence of 529 plans makes these "kiddie trust" accounts much less compelling now.

If you're saving on behalf of a child, the following options may not add up.

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