If you want to get your child a gift that keeps on giving – consider a Roth IRA.

Funding a Roth Individual Retirement Account for your child or grandchild’s future is a gift that will literally and figuratively be appreciated in the years to come. 

I know.  I have kids.  Your son or daughter might want something digital or shiny for his or her next gift.  But if you get them into the right frame of mind with a little explanation, he or she might actually prefer some financial security and learn an early lesson about the importance of mind – over money matters. 

You plant the seed (by funding your child’s Roth IRA), and then see how it (and your child’s money intelligence) grows: 

Say you open a Roth IRA for a 15-year old and fund it with $1000. If the money in that account grows at an annual percentage rate of 8%, which is a conservative rate, that $1000 investment will become about $47,000 in 50 years.  

The seed grows.

 If you added another $1000 to that Roth IRA over the next four years, it would make your total contribution $5000.  By the time that child turns 65 years old, their Roth IRA account will be worth more than $250,000 – without adding another dime beyond the $5000 you contributed. 

Your child’s money intelligence grows.  It sees value in and the power of long-term compounding.  This is a measureable and heartfelt return on your investment.

It’s never too soon for children to get/be taught a tiny but firm financial grip!  How you think about money usually rules what/how you do with your money for life.  Change/re-calculate your relationship with money.    Give yourself the gift of growing your best asset:  your mind.  You’ll be amazed at the amount of random and intuitive money knowledge you already have! 

Gift yourself a kinder and gentler financial frame of mind for the New Year: Mind over money matters.  Because mind over money – matters.  Think it.  Teach it.  Preach it.  Show it.  Grow it.  Share it.  Declare it.  Use it.  Protect it.  

Here’s to your health and wealth.

TAGS: Roth IRA, Roth IRAs for children