The department of human services is authorized to establish an account in the name of any child committed to the director of human services or the director’s designee, or whose legal custody has been transferred to the department, or who is voluntarily placed in foster care pursuant to section 234.35. Any money which the child receives from the United States government or any private source shall be placed in the child’s account, unless a guardian of the child’s property has been appointed and demands the money, in which case it shall be paid to the guardian. The account shall be maintained by the department as trustee for the child in an interest-bearing account at a reputable bank or savings association, except that if the child is residing at an institution administered by the department a limited amount of the child’s funds may be maintained in a separate account, which need not be interest bearing, in the child’s name at the institution. Any money held in an account in the child’s name or in trust for the child under this section may be used, at the discretion of the department and subject to restrictions lawfully imposed by the United States government or other source from which the child receives the funds, for the purchase of personal incidentals, desires and comforts of the child. All of the money held for a child by the department under this section and not used in the child’s behalf as authorized by law shall be promptly paid to the child or the child’s parent or legal guardian upon termination of the commitment of the child to the director or the director’s designee, or upon transfer or cessation of legal custody of the child by the department.