If you want to pass some of your wealth to your grandchildren, you’re in good company. Nearly all (94%) of surveyed grandparents have provided some financial support to grandchildren, according to a recent AARP study.

Whether you want to help your grandkids pay for college or jumpstart their retirement savings, there are a variety of ways to help your heirs be more financially secure. Here’s the breakdown:

1] Invest in their financial future

Some accounts give you the opportunity to set aside various kinds of assets for your grandchild — even assets they can’t legally own until they’re older — in a custodial account, and they can use the assets for any purpose.

UGMA

The Uniform Gifts to Minors Act (UGMA) is a custodial account in which you (as a grandparent, relative or a family friend) are the custodian, and you designate the beneficiary and the age at which the beneficiary gets the money. The child will pay taxes on any interest accrued at their tax rate, and the custodian can withdraw money from the account at any time. The termination age (the age at which the beneficiary gets the money) is typically 18 years old, depending on the state.

You can donate cash, securities such as stocks or mutual funds, or life insurance to this account. If you die before your grandchild reaches the age of majority, this account could be taxable as part of your estate. The funds can be used for any purpose. Any income from a custodial account is considered income for your grandchild, and the assets in an UGMA are considered assets of the beneficiary when it comes to financial aid calculations.

UTMA

The Uniform Transfers to Minors Act (UTMA) is very similar to the UGMA, except the termination age is usually 21, depending on the state. This gives you more time to control the account before your grandchild receives the money. And an UTMA allows you to donate basically any kind of asset to the account, including real estate, fine art and patents.

Traditional brokerage accounts

If you grandchild is 18 or older and you want to provide them with a hands-on learning experience, you can consider helping them open their own brokerage account. There are plenty of account options suitable for beginners, and helping them understand asset allocation and performance reports can set them up for financial success in the future. Unlike UGMA or UTMA accounts, your grandchild will have full control over the funds, so this isn’t a good option if you’re not confident in their money decisions.

2] Invest in education

According to the Federal Reserve, those with outstanding education debt in 2018 typically owe between $20,000 and $24,999, but you can help them cover costs and take on less debt:

529 college savings plans

A 529 college savings plan allows you to set money aside that can be used for eligible college expenses — and more recently, K-12 tuition. The money can be invested, and earnings are tax-free as long as the cash goes toward qualified educational expenses. Some states also give tax credits or deductions for 529 contributions. If you take the money out for other purposes, you’ll pay a 10% penalty plus any taxes owed on the earnings portion of the balance. And it’s worth noting that if the account belongs to you (not the parent), distributions for college are considered untaxed income for the child, so gift the money later in a child’s college years to prevent the money counting against their financial aid needs.

Coverdell education savings accounts (ESAs)

Like a 529 plan, a Coverdell ESA allows you to save money to an investment account, where it grows and can be withdrawn tax-free to pay for both college expenses and K-12 expenses. However, you can only contribute up to $2,000 per year per child, so coordinate contributions with the child’s parents and other family members, as needed. Of note: If you’re also trying to claim an American Opportunity tax credit or Lifetime Learning credit in the same tax year as your Coverdell withdrawal, part of your ESA withdrawal could be taxable. This will depend on how much you’re claiming in eligible expenses. Withdrawals are reported as income to the child on the next year’s FAFSA, so plan accordingly.

Roth IRA

If your grandchild earns income, you can contribute to a Roth IRA for them. This must be official income, so money earned from household chores doesn’t count. You can contribute up to whatever they earned in that tax year, with a maximum contribution limit of $6,000 in 2019 and 2020. Your grandchild will gain control of the account when they reach the age of majority, so if you have any concerns that they might use it wisely, this isn’t the best option for you. Once they own the Roth, they can withdraw the contributions at any point without penalty, and they can withdraw earnings for educational expenses, although they’ll pay income taxes on them.

3] Invest in experiences

You can also focus on investing your own money so you can take your grandchildren on trips and cultural excursions. Doing so can have just as much of an impact on their future as financial gifts — a 2013-2015 Student Youth & Travel survey of nearly 1,500 teachers found that 74% believe travel is very beneficial for a child’s personal development, and 56% say it has a very positive impact on their education and future career.

These popular experiences are great ways to invest in your grandchildren:

• Trips to national parks
• Museum memberships
• International travel
• Language lessons
• Cooking classes

In order to pay for these experiences, you’ll want to make sure you have a well-rounded investment portfolio. Here are a few account options to get you started:

Robo-advisors

Robo-advisors typically use technology-driven algorithms to invest your money based on your answers to questions about goals, time horizon and risk tolerance. They generally charge less in fees than a typical financial advisor, ranging from 0% to 0.40% as of December 2019. And you may still get access to a human for occasional questions, depending on which robo-advisor you choose.

Traditional brokerage accounts

You can also invest your money in a traditional brokerage account, either on your own or under the guidance of a financial planner. You can put your money into stocks, bonds, mutual funds, exchange-traded funds (ETFs) and other kinds of investments. You’ll pay taxes on the gains from this account each year.

High-yield savings accounts

At the easiest level, you can also sock some cash into a high-yield savings account. This money will likely grow at about the rate of inflation, although interest rates dropped in 2019, so you won’t earn much here. You might also consider certificates of deposit (or CDs) which might pay a slightly higher interest rate if you’re able to commit your money to the account for a specific period of time, such as six months or five years. (Keep in mind that rates on a CD are locked for that time period.)

There are several ways to use your money for the benefit of your grandchildren, and your approach will depend on how you want the money to be used. Whether it’s for education or for other financial needs down the road, make sure you understand the advantages or disadvantages of an account before you invest.

Maxime Rieman is Product Manager at ValuePenguin. Educating and assisting shoppers about financial products has been Rieman's focus, which led her to joining ValuePenguin, a consumer research and advice company based in New York. Previously, she was product marketing director at CoverWallet and launched the personal insurance team at NerdWallet.