Are There Ways To Assure That 529 UGMA Will Be Properly Spent?
Whenever a donor makes the decision to establish a 529 UGMA (Uniform Gifts to Minors Act) account, the provider of the account must bear in mind tat the money put into the account is owned by the child and cannot be used by the parent or custodian for any other person. The child will not receive the control of the account until he or she reaches a certain age. This rule was instituted by the state government. Despite this, the parent can use the money for the child’s benefit before he reaches termination age. If you suspect that the beneficiary of the 529 UGMA account will decide not to use the account for educational purposes, then do something about it. Now, one thing that the donor or custodian cannot legally do is to use the funds from the account for shelter, clothing, or food for the child’s benefit because these are considered parenting obligations. But, the money can be used for education equipment or tuition for the child. Whatever money is left in the account when the child b
