There’s no question that parents want what’s best for their kids. Their finances are no exception. That’s why so many families are exploring platforms like UNest to help grow generational wealth. Dig into our full UNest review to find out how UNest aims to build a brighter future for your kids.
Please note that, Unest may be experiencing financial trouble as a company according to Yahoo News. Please keep this in mind as you consider partnering with them.
In this UNest review, we’ll break down our favorite features and the most commonly asked questions about UNest. Of course, we’ll also share the areas for improvement and more about UNest competitors. By the end, you’ll have a sense of whether or not Unest is right for you.
Who is UNest?
UNest is an app designed to help families save for their kids’ futures. These simple, tax-advantaged accounts will allow minors to get a head start saving for future expenses.
Additionally, UNest is a registered investment advisor with the U.S. Securities and Exchange Commission. That means that they’re the real deal. The adult who opens the account can set aside savings within the account with confidence.
More so, UNest also allows other family and friends to contribute to the account with a simple click of a UNest account link. That means that adults in your child’s life can help them build generational wealth with ease.
Do you think that building generational wealth isn’t for your family? UNest is on a mission to democratize saving for kids’ futures, which is why they created a platform that any family–no matter your budget–can work with. With $25 a month, you can help your child get ahead of whatever life throws their way!
What is a UNest Investment Account for Kids?
First things first, UNest is not a 529 college savings plan. That means that the money set aside in the UNest account does not have to be spent on school. It’s much more flexible than that!
Instead, the UNest Investment Account for Kids is a type of kids brokerage account known as a UTMA. UTMAs, or Uniform Transfers to Minors Act, allow an adult to set up an account that will benefit the child later in life. Depending on your state, the child can take ownership of the account between the ages of 18 and 25.
It is also important to note that these accounts can come with up to $2,200 in annual tax benefits on the account earnings.
If you’re not clear on the difference, you can brush up on UTMAs versus 529s here!
How does UNest work?
UNest Investment Accounts for Kids can be funded in four ways. For this to be a comprehensive UNest review, we have to cover them all.
Let’s get started!
One-Time or Ongoing Deposits
After setting up a UNest account and picking a portfolio that matches your investment strategy, you can fund your account with a one-time or ongoing deposit. That means that the custodian, usually a parent, contributes money that will go to the beneficiary when they reach adulthood. This is probably the most familiar way that UNest accounts are funded.
Add Gifts from Others
Do you have a grandparent or other adult in your child’s life who is looking for a gift idea? Share your child’s UNest account link! By clicking on the link, other adults can contribute money for birthdays, holidays, or other occasions. It makes gift-giving simple and helps grow your child’s nest egg.
Shop Rewards Partners
It may seem counterintuitive to list spending as a way to help your child save, but hear us out! UNest teamed up with tons of different companies (over 150 the last we looked) that allow you to earn UNest Rewards by shopping in the UNest app.
Check out this short UNest Rewards brand list to get a sense of where you can earn extra!
- 1-800-FLOWERS
- Blue Apron
- Disney+
- DoorDash
- HavenLife
- Kiwi Co
- Nike
- Stitch Fix
Refer Friends
UNest also has a generous referral program. That means that if you’re liking the app, you can do your own word-of-mouth UNest review for other family and friends. If they sign up for their own UNest account, you get $50 (or more!) deposited into your UNest account.
Opening a UNest Account
Before you open a UNest account, you need to know a few things about who can be the beneficiary and who can be the custodian.
Simply put, a beneficiary is the minor who benefits from the account. When they reach adulthood, the money in the account becomes theirs.
A custodian is the adult in charge of the account. Typically, these are parents or grandparents. However, virtually any adult can open an account for a minor.
To open a UNest Investment for Kids Account, you need to provide this information:
- Legal name
- Birthdate
- Social Security Number or ITIN
- Address of residency
- U.S. Citizenship or legal residency information
In the event that the custodian or beneficiary are not U.S. citizens, you need these qualifications:
- Residential U.S address
- Social Security number or ITIN
- Green Card/Permanent Resident Card
UNest Review: Best Features
Our favorite aspects of UNest all revolve around you, the user! UNest is a platform designed to make investing simple and allow all families to save for a brighter tomorrow. So it shouldn’t be surprising that the best UNest features all center on this tool being easy and effective, even for new investors.
Easy to Use
UNest is incredibly easy to use. The UNest app is available currently on iOS and Google Play. That means that whether you have an iPhone or something else, you can set up an account with a few simple clicks.
The app itself is easy to navigate. Plus, the gifting link is really intuitive. That means that even the least tech-savvy grandparent is going to be able to make a gift simply and easily.
Low Expense Ratios
Because the investments are tied to Vanguard ETFs, that means that they benefit from low fees. In fact, the average expense ratio is .07%. That means more of your money stays working for you and your family.
Good for Beginners
People often spend time agonizing over making the best investment decision. The problem is they forget about the worst: not investing! By sitting on the sidelines, you are losing out on time in the market, which is the one investment decision you cannot reverse.
Another way that investors often get sidelined is by needing to save up hefty minimums before they can start investing. That’s not the case here! UNest defaults to a $25 monthly contribution, which is small enough to fit into virtually any family’s budget.
Additionally, you can reach out to UNest Support about making one-time deposits instead.
UNest Review: Areas for Improvement
It wouldn’t be a UNest review if we didn’t share a few areas for improvement. Before you open a UNest account, it is important that you understand how these investment accounts work. You also want to make sure that you’re clear on the fees and know if crypto is (or isn’t) part of your financial plan.
Financial turmoil
Recently, UNest has taken some heat for some behind-the-scenes financial woes. The company CEO stepped down in late 2023 after saying UNest was “insolvent”.
The Chief Operating Officer of UNest says that users don't need to worry. Their deposits and investments are still protected. However, the news certainly is worrisome and might drive users to consider other college savings options.
Financial aid implications
When it comes to this first area of improvement, it’s not specific to UNest. In general, investors need to understand how UTMAs and kids' custodial accounts can impact financial aid.
These types of accounts can count against financial aid considerations by 20-25% of the asset value. UTMA and custodial bank accounts are weighted more heavily against financial aid than 529 plans.
That doesn’t mean that you shouldn’t move forward with your plans for a UTMA. But it is important to make sure that you understand the tax advantages of the account as well as this financial aid drawback.
Monthly fees
Simply put, you can take your pick of options for custodial bank accounts for kids that don’t come with monthly fees. So if you don’t want to pay to use a tool. UNest might not be for you.
However, the ease of use of the UNest platform and its dedication to helping new investors get started can more than outweigh the $5 fee each month.
Overemphasis on crypto
Many platforms moved too slowly with crypto or still don’t acknowledge that it exists. UNest seems to have moved in the opposite direction. Crypto takes up a significant portion of their site.
This overemphasis could steer new investors into a type of currency they don’t understand. However, if you are interested in learning more about digital currencies, it’s worth noting that there is a UNest Crypto option.
UNest Review: Competitors
There are several different popular UNest competitors that you might also be considering.
EarlyBird
You know the saying–the early bird gets the worm. In the case of this EarlyBird, the kid gets savings for their future and a fun way to capture milestones along the way.
EarlyBird is similar to UNest in that it works primarily through an app. EarlyBird builds portfolio options for investors and allows automated investing. Family and friends can also contribute to your child’s account. In addition to leaving a monetary gift, they can also leave a memory to capture the milestone. That’s why EarlyBird says they are building a capsule of capital and love for each child.
Vanguard
Vanguard is a very popular platform when it comes to brokerage accounts for kids. That’s partly because Vanguard pioneered the idea of making low-fee investments available to everyday people.
A Vanguard brokerage account is a solid choice for families who are already familiar with the Vanguard platform for Roth IRAs or other accounts. You might also use this UNest competitor if you want more flexibility in terms of how much and when you contribute.
Fidelity
Fidelity is another fan favorite when it comes to investing. That’s because there are no minimums or account fees to invest. You also have access to some of the lowest expense ratios available.
If you are already a Fidelity customer, then you know that their accounts come with different planning tools. Their custodial UTMA/UGMA accounts are no different. Fidelity believes strongly in focusing on building financial literacy. That means that their tools and education resources will help you and your child’s financial knowledge grow together.
UNest Review: FAQ
To round out our UNest review, we rounded up answers for the most commonly asked questions about UNest.
Is there a minimum contribution?
Yes, you have to make a monthly contribution of at least $25 to your UNest account. However, you can reach out to the UNest Support Team to see about making one-time deposits at your convenience.
What is the most I can contribute to my UNest account?
To avoid worrying about gift tax laws, you can contribute up to $15,000 as an individual or $30,000 as a married couple to your UNest Investment Account for Kids.
Does UNest charge a monthly fee?
Yes, UNest charges a monthly fee. UNest costs $4.99/month whether you are setting aside money for one child or several.
To bring down the cost slightly, you can also pay a $39.99 annual fee.
Users should also note that there is no fee for receiving gifts. However, gifters will pay a convenience fee that is disclosed when they make the gift.
Does UNest earn interest?
UNest investments can earn interest. But don’t confuse UNest with a savings account or CDs!
UNest offers nine different investment options, all of which are based on Vanguard ETFs, or exchange-traded funds. That means that you are likely going to benefit from compound interest over time. But there aren’t guaranteed interest rates like you might lock into with a bank CD or savings account.
Can you withdraw money from UNest?
Money can be withdrawn from UNest. In fact, when you make a withdrawal, you can avoid penalties and fees. The catch is that you have to make sure that the withdrawal benefits the child named on the account.
There may also be up to a 30-day holding period before you can withdraw your money. That means it’s best to make sure that the money you contribute won’t need to be withdrawn immediately.
Remember the goal for platforms like UNest is to build future wealth; not access your funds immediately.
Is UNest safe?
UNest recognizes the importance of keeping user information safe. That’s why UNest uses bank-level security and 256-bit SSL encryption.
Additionally, your money is protected in two ways. Before your money is invested, it is held with a partner bank. That means that your money has FDIC insurance up to $250,000.
Once your money is invested, it is covered up to $500,000 by the Securities Investors Protection Corporation (SIPC). It is important to note, though, that SIPC protection doesn’t cover investors from market losses.
What happens if my family grows?
Congratulations! If you find yourself with a growing family, UNest makes it easy to open and manage accounts for more than one child. The process is just as simple, and you can actually manage multiple accounts through the UNest app.
How can I get UNest support?
UNest believes families should be supported throughout their savings journey. That’s why their team is available even before you set up your account.
Get in touch with UNest using three different options:
- Fill out the comment form on their website
- Email support@unest.co
- Call 818.275.0041
There is also a robust FAQ library on their website, walking you through everyone from account creation to personalizing UNest gift messages.
Final Thoughts on Our Unest Review
Are you looking for a platform designed to simplify the saving and investing process? Do you want to help your child save for the future without just saving for college? UNest could be right for you! If you don't mind paying their monthly fees and you've reviewed the financial aid implications of going the UTMA route, then check out how UNest makes it simple to get started building a nest egg for your children today.
What surprised you about our UNest review? How are you building generational wealth in your family?
Please let us know in the comments below.
