What type of account allows for a custodian to manage funds until the beneficiary reaches a certain age?

A UTMA (Uniform Transfers to Minors Act) account is specifically designed to allow a custodian, typically a parent or guardian, to manage assets for a minor beneficiary until they reach a specified age, which varies by state (typically 18 or 21 years old). This type of account provides the minor with the ability to receive gifts and inheritances while ensuring that an adult manages the funds until the beneficiary is mature enough to take control.

In contrast, a Traditional IRA and a Roth IRA are retirement accounts that have specific rules regarding contributions and withdrawals, but they do not have a provision for custodians managing funds for minors. An Education Savings Account, commonly known as a Coverdell ESA, is intended for educational purposes and does not function in the same capacity as a UTMA account, which allows broader management of funds until the age of majority. Thus, the UTMA account is the unique option that provides the custodial relationship necessary to protect the interests of a minor until they reach adulthood.