I don’t have a wife, much less kids. But if I were to have kids, I would definitely set them on the rat race quicker..possibly for them to retire by their early 40s.
Here’s my how-to-guide:
- As soon as they get their Social Security #, get them all kind of referral bonuses through banks such as ING, Sharebuilder, Virtual bank, etc etc
- Open them an account at affinity bank 10% APY up to $500. That’s like making $50 a year.
- Any money through gifts, set them up a savings account with at least 5% APY.
- Start a wealth trust fund for them by buying ETF’s or Index fund. Do not let them know til 18! Tell them to recycle this method once they have their own kids. This is how the wealthy stay wealthy.
- Add your kids as an authorized user to your credit cards and home mortgage loan so they would build up their credit score. **do not let them know til they turn 18*..must you guess, they will have one hell of an apporama!
- When they get to 5 years old, set them up a 529 plan in their grandparents’ names. Why? Because if you do it in your name, it will count against you for Expected Family Contribution (EFC).
- Screw private school, my kids are going to public school for sure even if I am a millionaire.
- By the time they are 9 years old, set them up as an employee with a salary in your home for doing chores. By doing so, you can set a Roth IRA for them. All of their money should go to the maximum of a Roth IRA. Can you imagine having a 15 year head start on a Roth IRA?
- Never ever spoil your kids with money, but teach them how to earn money and the hard work along with it.
- Screw the likes of myspace, xanga, and facebook…If they want to have a social website,
tellforce them to start a finance blog in order to make money through blogging.
- By 12, teach them entrepreneurship such as setting lemonade stand and garage sale. There are many freebies they can get through the internet. Teach them the value of standing in line for 12 hours to make $5000 profit for Playstation 12! Learn to ebay.
- Emphasize that money is not what you can show, but what is in your bank account. Buying stupid things like the latest cloth or high tech item is a waste of money.
- At the age of 15, get them a weekend job while in school and full time in the summer. Teach them 401K, Roth, tax, etc …all the goodies that come with a J-O-B!
- Just like the real world, you start at minimum wage…but learn to jump ship as soon as a higher paying job comes up. All money should go toward investments.
- Emphasize that learn to be cheap while you ain’t got no money..then move on to being frugal when you do have money.
- Make their ass study hard for school and SAT, and get them to apply to as much financial aid and scholarship as possible.
- By the time they are 18 for college, get them to go to a local university. Buy them a house in your name with 20% down/15 year mortgage, then tell them to find roommates and charge for rent. Charge enough rent whereas the money will cover the mortgage, tax, and insurance. Then transfer the title to their names once they graduated.
- Teach them app-o-rama!
- When they are in college, money should be borrowed to the max through Stafford loans even if they don’t need it. Why? use they 0% interest loans to invest in 5% savings account.
MakeGear them toward financial reward careers such as Dentist(150K to start), MD(200K to start), or Pharmacist(100K to start).
That’s all I can think of…of course your kids must have fun too…especially when they have half a Mil before 30…haha!
That was just going with the flow..there is no reason. Start whenever you like. Obviously, the sooner the better.
For me, I prob won’t open a 529 cuz I expect my kids to be going to school with a full ride on academic scholarship. Believe me, darn kids will go to school for free.
Just curious why you would wait until age 5 for the 529 plan. I set one up for my niece at birth and it’s churning along nicely. First 5 years of a 529 is when you can shoot for higher returns (all stock allocations)…why wait until age 5?
Love the blog and all you do!!!
MONEY BLUE BOOK says
Hey Player! You forgot the most important item to do when they are still young….
Register a domain early for them so they can reserve it before they are all all gone by the time they’re adults!! 🙂
-Raymond (MONEY BLUE BOOK)
That requirement is usually waived if it’s a parent applying for a custodial account on behalf of a minor. Call the bank directly and ask. A lot of banks will do this but most don’t openly advertise it. I got my first checking account with Washington Mutual when I was only 16. This long before they moved to generating a fresh market with minors with their Wamu Kids program. My mother had to be a joint owner on the account and sign something assuming all liability. However, my own social security number was used instead of hers.
How do you get around the fact that ING/Virtualbank require applicants to be 18 yrs of age?
In regards to getting them referral bonuses will places like Sharebuilder and Virtual bank care that you are opening another account and funding it from the same source as your personal account just under your kids name? I have done this with ING no problem but I am wondering if the others will allow it.
Your awesome as usual. Thanks for the tips.
Easy No-Hassle 529 Savings Plan:
1. Setup a 529 Plan Account with Fidelity Investments and make direct deposits from your checking account with as little as $15/mo. Only $50 initial deposit to open an account:
2.) Link the 529 Plan Account to a 529 College Rewards American Express Card that gives 1.5-2.0% cash back (depends on the offer you signed-up to):
3.) Make all of your Costco grocery purchases on that neat cash-back 529 Amex card. (Costco only takes Amex, BTW)
4.) Over the course of 18 years (or more if you start before they’re even born), watch your college savings grow along with the stock market’s general upward trend.
Of course, the $15 you pay every month can come from all of the excellent bonuses Anthony shows you on this site. If you bring in even just an extra $100-$200 every other month or so, you can probably bump that monthly contribution up to $25 or $50. That is what I have been doing, of course. 🙂
Thanks to Hustler $$$ blog’s excellent deals, my future kids will go to college for a lot less than I had planned. The extra money is also helping me pay down some of my student loans.
thanks man..of all the posts on this site, I would have to say this is my favorite. haha..alot of them are crazy..feel free to add on.
Wow what a list ! especially #7 Screw private school! ha I like that.
I’m with you, no matter if I have the money or not I will find a good public school and make them study!!!!
I already started investing in 2 stocks for my daughter and she has a UGMA acct.
Next I must teach her how important a credit score is.
My Aunt bought a home for my cousin when he attended college. He had 4 roomates and the rent covered the mortgage. Once he graduated he had the home transferred in his name.
Smart move my Aunt made.