What is a Custodian?
A custodian is a financial institution tasked with holding, protecting and administrating financial assets on behalf of clients. Their responsibilities include safekeeping, transaction processing, compliance support and tax reporting.
Custodians are especially critical for IRAs and other tax-advantaged accounts, where the IRS requires proper documentation and reporting of eligible investments. In self-directed retirement accounts that include alternative assets like private equity or crypto, the custodian’s role becomes even more important due to the added complexity and regulatory scrutiny surrounding alternatives.
Choosing a reputable custodian can give investors confidence that their holdings are secure, legally compliant and accurately tracked.