Current Investments to Secure Your Children’s Future

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The best way to ensure that your children’s future is secure is to make investments for them. Investing in your children’s future will help provide financial security in the case that something were to happen to you or your spouse. Making sure that their children will lead a full a prosperous life is a priority of many parents. With your help, your children can weather excessive education costs, the cost of living, and even the cost of starting their own family. Here are five very savvy financial investments into your children’s future.

Take Out a Life Insurance Policy

Life insurance will provide a financial payment to your children and dependents in the case that you or your spouses pass away. This payout ensures that your children will be taken care of should anything happen to you or your spouse. The policy will allow your kids to have financial stability in the aftermath of a death, and will let them lead the same lifestyle as they were leading before. Life insurance can also pay for post-secondary education expenses, which will ensure that they can afford to attend the university that they want to. You and your spouse will rest easier knowing that if something were to happen to one of you, your family would remain financially intact, and your children’s futures would not be compromised.

Fund a Roth IRA

A Roth account will allow your children to save any money that they earn throughout their childhood, or any money you put into their account up to $5000 a year. The funds that are put into a Roth IRA will grow tax-free since it will be considered after-tax money. Even if the stock market plummets, your children have a great chance of growing their money in the long-term by diversifying their account and perhaps including foreign bonds and stocks. Getting your child started ahead of the crowd comes with huge benefits. If you your children get in the habit of saving a $1oo a month between the ages of 25 and 35 they will have accumulated $200,000 by the age of 65.

Fund a 401(k) Plan

You should set your children up to began contributing to a 401(k) plan as soon as you can, so that they have a head start on saving, and they will save on taxes in the future. By giving your children the $5000 or more that it takes to get full advantage of a 401(k) plan, you will rest easy knowing you gave your children a great return.

Help Pay for Graduate School 

It can be hard wrapping your mind around paying for your children’s advanced degree when you haven’t even figured out how to pay for college yet. If it is feasible however, you should consider helping your children continue their education, since it can really jumpstart their career. You can do this by putting a lump sum into a 529 plan under each of your children’s names. This plan allows anyone to contribute to your children’s educational future and the earnings will grow tax-free. When the time comes, this money can be used for your children’s continuing education, or can be transferred to your grandchildren’s future college expenses.

Directly Invest in Your Children

If any of your children reach adulthood, and have a grand idea to start a business, you should consider investing in him or her. Although it is true that most startups fail, by investing in the tools he or she needs to start a business, it will mostly likely have value beyond his or her actual business venture. In the end you never know, maybe your kid will be the exception.

 

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