So..a 401k At least the 401k is pre-tax. This on the other hand is taxed on both ends. Maybe I am missing something, but I really don’t see the upside.

It's more like a 529, but can also be used for first home purchase as a qualified withdrawal.

It's also tax-free growth (not that the average <18 y/o would incur any tax on $250-$1250 of principle)

Yes. You know, like the kind of 401k a seven year old has.