re: Kid's money

I like the idea of using it to fund a Roth when they start working. The 529 is also a good option for tax differed growth. Just be aware the Roth rollover has restrictions. Account must be 15 yes old before
rollover and contribution must be 5 years old.
Any assets in kid's name outside retirement accounts will be held against them for financial aid at higher rate than parent assets. So unless it will be spent before FAFSA, may be best to keep in your name and move to their Roth when eligible.
Grandparents stashing it in a 529 may be best.
What was the purpose of this gift?That would shape my approach.