How To Invest For Your Kids

Warren buffet has the best quote when it comes to raising kids and giving them money, give your kids enough to do anything but not nothing. Think about that for a second, and let sink in.

The goal should be with this plan to give your kids enough for an education, teach them to work and invest and financially set them up with some extra help with a potential investment match program so they can have enough.

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1. 529 Account

This is an account you should start today, and not just by sending over a random amount of money

But you should calculate the exact amount your kid is going to need for college

And you should read this book “ Debt Free degree “

Now to explain in a simple way, this an education tax free investment amount, as long as the money is used for education its tax free

First: How Much will your kid Need for College adjusted for inflation

Lets say your kid is 5 years old ( obviously usually by 18 they have to to college )

Usually about 20k if follow that book I just told you about

Using the smart asset calculator and inflation rate of 3% would be $27,570

This would requires a $66 investment per month

Me personally I would want to have a margin of safety of at least 50% incase of market crash, so that’s $41,355

2. Custodial Roth IRA ( Funds ) – need a job so usually by 13

This is super important because this is a tax free retirement account for your kids

The average person doesn’t have one of these as a kid

So once your kid has their first official job, you open one up for them and also invest the money for example in to the S&P 500

Teenager make

According to the BLS about $566 per week, so if you train them to early on to invest 20% of what they make

Save 10% for future and 70% to spend ( this could change everything )

Just 5 years of investing 20% of 2000 a week, is about $33k

3. Custodial Brokerage

This is basically a normal brokerage account with no tax incentive

Where you tell you kid, for every dollar you invest I will 50cent worth or 25cent

So when they invest 400 and you put in 200 that’s 15k in 5 years

Or when they do 400 and you do 100, that’s $8295

MY plan is this:

My biggest goal with helping people, is helping them not need me

Of course emotional support and company are important

But the goal of a teacher and mentor is for the student to surpass them

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*Some of the links and other products that appear on this video are from companies in which Tommy Bryson will earn an affiliate commission or referral bonus. Tommy Bryson is part of an affiliate network and receives compensation for sending traffic to partner sites. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. I’m an Accountant but I’m not your Accountant, always review information with your Accountant/CPA and your Financial Advisor.

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