If you want to get your kids started on the road to financial independence, here are 5 ways to get them going fast!
1. Automated Investing Accounts.
Need a quick, cheap, automated, and simple way to get your kids on the road to savings? Look no further than index investing through an automated service! Often referred to as "robo" investing, these automated accounts offer basic access to the power of the markets and have very low minimums.
SHAMELESS PLUG ALERT.....ACG offers our own customizable solution using Schwab's Intelligent Portfolio platform. If you are interested in learning how this could benefit your kids, please contact us!
2. 529 Plans.
These plans are state-run programs that give you large deposit limits and access to various investment portfolios of your choice. Depending on your state, you may get tax credits for your deposit as well.
3. Use a Roth IRA.
Roth IRAs offer some of the best tax advantages around. Use your Roth to maintain access to contributions, tax-free withdrawals, and tax-free growth. Your invested principal within a Roth is always available, and there is no requirement that you use the money for retirement.
4. Bank accounts designed for kids.
Bank accounts designed for kids are becoming more popular these days. Do you work with a larger, national banking institution? Chances are they offer some of these new products! Give them a call and ask.
5. UGMA Savings Account.
Although my least favorite option, child savings accounts are available at most banking institutions and make for a good start prior to age 18. Word of caution.....spend the money prior to the child graduating high school because it can be counted against them if applying for financial aid!