Financial Planning For Your Young Child 102 - What Should You Do?
Strategies to maximize child savings
[Note - these are some general strategies and ideas for you to explore. We are not financial advisors, we aren’t tax experts, and we are an anonymous cartoon character in a bowtie. Everyone’s situation is unique so talk to your own advisor & do your own research.]
We started the week going over 8 different accounts that are available to your child to invest.
That was a mega post to lay out a summary of each account. We are going to assume you read it, or will refer back to it for any basic questions.
We also want to reiterate that you need to take care of your own financial situation before worrying about your children. [Reposted from the prior post due to how important it is]:
Here is the order of your focus:
Get 6-figure+ income
Refinance any high interest debt & use the ‘Infinite 0% APR debt cheat code’ to lower the cost
Set aside 3-12 month emergency fund
Pay down any remaining high-interest debt
Invest 25%+ of your earnings
Pay any lower interest debt (if you want)
Consider to start saving money for your kids
Yes, there is a lot to do before you divert your own money into retirement/college savings for your kids. Trust. You do it so your kids don’t need to take care of you in old age…Also, you should be doing 1-6 anyway.
F’er knows of >0 adults who are dog-dick poor and keep trying to put money into their kids accounts. One of our mothers may have been floating 20% APR credit card debt while putting money into US Treasuries to invest for us kids (granted, UST were yielding 5%+ back then). And while she was doing that, we were making money and using it to try to pay off her credit cards. Very inefficient. Take care of yourself first.
Enough disclaimers & warnings, lets get to some strategizing: