That Time We Inherited $3,200

by J. Money - Last updated October 14, 2014

Getting an inheritance is always bitter sweet. On one hand you’re getting a chunk of money for free for doing nothing at all, and on the other someone has to pass away in order for you to receive it. It’s very much bitter, with a tinge of sweet.

Then you have the times when it’s 99% sweet and only 1% bitter – like when you receive a call out of nowhere saying you’ll be receiving some money from someone who died well over 15 years ago – WOW! And to the tune of $3,200! It still stings of course when you’re reminded of that fateful event so long ago, but what a nice surprise to come after all these years :) As if it were on purpose to continuously bring joy to your loved ones’ lives.

[Note to self: When you distribute your own millions in 98 years, be sure to “forget” about some of it and have your future great-great-great-GREAT grandson hand deliver the checks to all family members years after you pass. Or better yet, divide it by 50 years and have that great-great-great-great grandson send the checks every year for half a century and REALLY make your family happy! That way the slackers can’t spend it all at once too ;)]

Anywho, I’m not quite sure what the reasoning was behind this new money we’ve now received (it was from a family member on my wife’s side), but regardless we were given $3,200 to do with as we please, so long as “what we please” equals “giving to our kids.” So really, it’s for Baby Penny and Nickel.

And what do you do with a kid’s inheritance?

Well, you could:

  • Buy them tons of candy
  • Buy them gobs of fancy toys (iPotty anyone?)
  • Put the money into their savings
  • Put the money towards their future college degrees

We went with the college degrees. Specifically, their 529 college savings accounts through Virginia529 – our state’s plan so we get double bang for our buck: tax-free growth AND a write-off for investing in the first place! Up to $4,000 per account, and per YEAR. A perfect way to extend those happy little dollars if I do say so myself. (We went with the inVEST option btw, not prePAID)

Once we settled on where this money was going, the next question became – How much do we give each kid? Do we split it up evenly so it’s technically fair, or do we make sure both kids have the same amount invested in their accounts since one has a whole lot more than the other being a year older in the game? How much lopsidedness is appropriate?

I’m still not entirely sure what the right answer is, but what we ended up going with was the “let’s get the two accounts as close together as we can” route. Mainly, because one had $4,500 in their account and the other $0.00. Just didn’t seem right to give each $1,600 when we’re no longer in the position to contribute to *either* account on a monthly basis anymore :(

When Baby Penny was born the income was rolling in and we were able to divert a cool $4 grand to it. With money being tight now, however, we haven’t thrown a dime into Baby Nickel’s 529 (or had opened one up, for that matter) leaving him with a big fat goose egg to stare at.

So in went a whopping $3,200 into Baby #2’s account which leaves us more balanced now:

  • Baby Penny’s 529: $4,504.29
  • Baby Nickel’s 529: $3,065.83

(The market’s depleted a little of each since making the investments. But of course we don’t worry about that because we have 17+ years a head of us for this $$ to grow and grow and grow!)

Perhaps it should be $6,104.29 to kid #1 and $1,465.83 to kid #2, but regardless we did what we thought made the most sense and if ever questioned by them I’ll whip out the forever mighty – “Because I’m the dad, that’s why.” I cannot WAIT to finally be able to say that after all the years of hearing it myself, haha… what a genius line! ;)

Where this $3,200 was invested INTO...

vanguard funds virginia 529

Here’s the other beautiful part to the story: Virgina529 has Vanguard funds as an option to invest in! Rock on! Which means we can really not have to worry about growing this money over time as it’ll be indexed and clear of ridiculous fees all over the place, ugh… And not only that, but they have the one fund I was debating on throwing all my retirement money into too!

  • VASGX – Vanguard LifeStrategy Growth Fund

It was a bit more conservative than my VTSAX I ended up going with (Vanguard Total Stock Market Index), but next on the list of “wants.” So now my kids get them which is a lot more appropriate in my eyes for what it’s going for – safer growth over time. It’s still nice and aggressive (and categorized as so in the plan), just not as aggressive which I’m perfectly fine with. So I thought that was pretty cool :)

(Btw, xfering 529 accounts from state to state is pretty easy these days – in case any of you have been putting it off. It literally took a phone call and dropping a simple form in the mail to move Penny’s from Maryland to VA.)

Here’s a refresher of what VASGX holds:

  • 56.1% — (VTSMX) Vanguard Total Stock Market Index Fund Investor Shares
  • 24.0% — (VGTSX) Vanguard Total International Stock Index Fund Investor Shares
  • 16.0% — (VTBIX) Vanguard Total Bond Market II Index Fund Investor Shares
  • 3.9% — (VTIBX) Vanguard Total International Bond Index Fund

So 80% stocks and 20% bonds vs. 100% stocks like my sexy VTSAX.

Anyways, that’s what’s been going on over here lately… I’ve hinted it may be coming over the months of net worth updates, and fortunately it proved accurate. Didn’t want to get my hopes up until I saw the $$ hit our account, if you know what I’m saying… Again, crap way to receive it but much better after so many years have gone by! And I’m serious about my own wealth down the road…. Totally gonna surprise the hell out of my loved ones when I’m gone ;)

I’ll leave you with one other nugget to marinate on…

Do you/would you include college savings into your net worth?

Since you’re technically the owner of it and can disperse the money to whom you see fit, even yourself? Or do you separate it out since it’s money that’s “owed” to someone else at a future point in time?

Originally I kept it out of our net worth myself, but then I realized the kids may never use it if they have their mom’s smarty pants genes and all get scholarships, so I added it in since we could always end up keeping it in the end (along with a hefty tax bill, of course).

The more I think about it these days, however – especially with the “wishes” of this new inheritance addition – I’m confident we’ll just end up giving it to our kids regardless of the situation. After all, it’s set aside to be invested into their future, so whether that’s college or their first home or even first business, the point of this money is to help jump start their lives, right?

So I’m now thinking we need to take it back out again – though it pains me to not have money accounted for like that. I use my financial snapshot to show *where* all our money is at any given point in time, so I’ll just have to devise a section for the kids and account for it there. Though now that I think about it it’s not like we include their savings accounts in our worth, so why would their 529s be any different? Hmm… I think I’m having an epiphany here :)

But I digress… Point is, our kids inherited some money, daddy’s using Vanguard funds to help grow it into the millions (since that’s what college will cost by then – hah!), and in 17 years we’ll give the gift of a fully paid for degree just like our parents did for us. Society may not believe in college like it used to, but we sure still do. And it would be a blessing to have our boys join the real world unsaddled by such massive debt like so many of our friends.

Now let the opinions fly! ;)

——–
PS: Here’s a post I did on the pros and cons to 529 college savings accounts when we were first looking into them – in case you’re embarking in some high-quality baby making too!

[Photo cred: Sean MacEntee]

************

Bonus tip: Find a good "balance transfer" offer to help pay off debt faster!

If you’ve been making payment after payment (on time) and still haven't been able to get your debt under control, snatching up a good balance transfer credit card offer may be the ticket to try. That’s where in order to gain your business - credit card companies will let you transfer your existing debt to a new card and let you pay ZERO PERCENT interest on it. Saving you tons every month!

What's the catch? Usually balance transfer cards charge a fee (around 3% of your debt balance) to let you transfer your balance to their 0% interest offer. But we've found a great credit card that will let you do a balance transfer absolutely free. Click here to learn more and see if you qualify!

PS: If you don't trust yourself with another credit card, ignore this! This strategy is to help you get out of debt quicker, not risk adding more to it.

Jay loves talking about money, experimenting, blasting hip-hop, and hanging out with his two beautiful boys. You can check out all of his online projects at jmoney.biz. Thanks for reading the blog!

{ 62 comments… read them below or add one }

1 Chris @ Flipping a Dollar October 15, 2014 at 6:37 am

Lol. I think you meet the intent by putting it aside. I’m sure you’ll pay 3k to those kids many times over as they grow up! Plus you can always give it to grandkids or guse it to cover rent or something like that (for the future student). Free ride doesn’t usually cover all expenses!

We just moved to MD and I haven’t looked into this. PA used to let us deduct contributions to any 529 bit MD only does for its own. Thanks for nudging me into checking this out. We put $100 a month away so a ~1k deduction would be awesome every year!

Reply

2 J. Money October 15, 2014 at 11:38 am

Yes! Do it! We got killer tax benefits from investing in MD’s direct 529 plan too – it’s definitely awesome :) I’m gonna hit you up in email to see where exactly you are – maybe one day when I’m back in town we can grab coffee?

Reply

3 Mrs. Frugalwoods October 15, 2014 at 6:45 am

Giving your kids a debt-free college education is awesome. I think it’s one of the best ways to prepare them financially for life. Mr. FW and I both emerged without any higher ed debt and it’s a huge factor in our financial successes.

Also, makes sense to me to take it out of your net worth–like you said, if you’re not counting their savings accounts, probably holds that you shouldn’t count the 529s either.

Reply

4 Jay @ ThinkingWealthy October 15, 2014 at 11:09 am

I compeltely agree. My parents worked their asses off so I could exit college debt-free. They know they’ll be taken care of in their old age by myself and my siblings in return (it’s a cultural thing).

Also, do not include this in your net worth. Think of it as a sunk cost!

Jay

Reply

5 J. Money October 15, 2014 at 11:40 am

Yeah, that’s a good idea – thinking of it as a suck cost, I like that. And even more so when it’s not *my* costs being sunk in this instance ;)

Reply

6 A. October 15, 2014 at 6:49 am

How much do you get from Vanguard for mentioning them in every post?

Reply

7 J. Money October 15, 2014 at 11:43 am

A cool $0.00.

For some reason they keep denying my request to pay me a $1,000,000 a mention?

Reply

8 Brian October 15, 2014 at 7:41 am

I don’t include my kids’ accounts in my net worth. Technically it is my money until they need it, but I am assuming that they will use it, or I will find another eligible person to use (maybe my grandkids one day).

Reply

9 Emma | Money Can Buy Me Happiness October 15, 2014 at 7:47 am

I’m reading a lot lately about the costs of college in the US. I’m from New Zealand where it costs around 7k per year to study but we get interest free student loans (so long as we don’t leave the country, interest applies when we move overseas for longer than 6 months). It makes sense that you would save and invest for such a huge expense and big ups to you for being willing to front it for your kids. We are personally saving to buy our son his first house so he can go to university and rent spare rooms to other students (we plan to buy close to our cities Uni) and use that income to pay his student loan back. Since it’s interest free there is low incentive to pay it back quickly!

Reply

10 J. Money October 15, 2014 at 11:46 am

Oh wowwww that’s so interesting! I know many nations have far better deals w/ college, at least financially, but always love hearing the details so thanks for dropping by :) I’d love to bitch and moan about the costs here in the US, but just seems like 1st world problems to have comparatively. And even more so when I never paid for my own degree!

Reply

11 Dee @ Color Me Frugal October 15, 2014 at 7:52 am

I’ve seen others include 529 plans in their net worth. I had assumed we would too, although we haven’t started saving for college yet (our daughter is only 3 months old so we aren’t that far behind yet), but now you’ve got me thinking. I guess maybe we should not include her 529 account in our net worth. Going to have to ponder that one!

Reply

12 J. Money October 15, 2014 at 11:47 am

I go back and forth on it but currently leaning towards taking it out now…. I think it’s okay to change your mind and go with the flow since at the end of the day your net worth is just for YOU :) the important part is that we’re all tracking it to begin with!

Reply

13 Chenell Tull October 15, 2014 at 7:59 am

Oh, I thought you were making up that iPotty thing as a creative joke…and then I clicked on the hyperlink. Eek. I’m interested to see if anyone actually buys that product through your link :)

I like the article though, definitely an interesting topic to think about!

Reply

14 J. Money October 15, 2014 at 11:54 am

Haha nope – that thing is real and SUPER popular! Google the reviews, it’s crazy…. Finances aside (you’d have to buy an iPad too if you dont’ already have one!) the whole idea is just insane to me. I’m trying so hard to keep my kid away from electronics whenever possible cuz I fear they’re gonna be glued to this stuff more than our current generation – which is already hardcore!

I will say though for certain disabilities ipads and the like are life changing. We helped a family with two autistic boys get ipads and they were able to “talk” through it for the very first time of their lives. To hear their mother talk about when they first said “I love you” is incredible…

So I’m def. a fan of what technology can do, but when it comes to pooping I’m outta there ;)

Reply

15 Chenell Tull October 23, 2014 at 10:57 pm

Not sure how I missed this reply, but anyway – that is hilarious! If I have kids, I think I will try to delay the obsession with electronics like you are. Let the kids live! They are already going to have a humpback by the age of 40 from looking down so often, let’s not make the situation any worse. :)

I completely agree about the use of iPads for autism and similar disabilities. They are life changing and give many non-verbal folks a “voice” for the first time. They are definitely useful pieces of technology, but I wouldn’t practically force it on the babies while they are learning to use the loo. ;)

Reply

16 Robin October 15, 2014 at 8:11 am

I don’t include my daughters savings into our net worth. I feel like I would be cheating if I did. :)

Reply

17 Walnut October 15, 2014 at 8:26 am

I would track contributions into each account and be certain that those numbers are similar for each child. Since you invested earlier in one kids account, it makes sense to contribute all of this cash to the other.

Reply

18 J. Money October 15, 2014 at 11:55 am

Glad to hear that sounds okay to do! Who woulda thought these types of “problems” would come up when you think about fatherhood. I’m kinda enjoying it :)

Reply

19 Brad @ RichmondSavers.com October 15, 2014 at 8:44 am

I absolutely include the 529 plans in my net worth. If I didn’t put the money in a 529 it would be sitting in my regular investment accounts and that obviously would be included in my net worth, right?

And in that scenario I would have to pay for college someday out of that investment portfolio.

This is the same exact thing, just slightly smarter to get the tax benefits of the 529. Can’t think of a convincing reason to exclude it from net worth because of that…

Reply

20 J. Money October 15, 2014 at 11:57 am

Dang you! I knew I forgot something that helped convince me of that. You just had to make it a tough decision again, didn’t you? :)

I guess at the end of the day this is going to come down to a personal decision, just like other items with this stuff (whether to include your house, cars, etc etc). I like the idea of both options, but I’ll sit on it for a cple more weeks before the next update and then go from there… Thanks for the reminder!

Reply

21 Jon @ Money Smart Guides October 15, 2014 at 8:58 am

Growing up there weren’t 529 plans. Every Christmas my grandfather would give the grandkids $1,000. My parents would take ours and put it in a mutual fund for college. I didn’t even know we were getting the money until I was in my teens. At that time, I got mad that I couldn’t spend the money/do with it as I pleased. But looking back, my parents made the right call as it helped to keep my student loans under control.

As for including 529 in your net worth, I say no, because it’s not your money, it is for the kids. When I worked at a high net worth financial planner, we would take the same thought process when creating investment plans. We wouldn’t include it in the parents net worth because the odds of them using the money for themselves was almost non-existent. Even if the kid didn’t go to college the parent was still giving them the money.

Reply

22 J. Money October 15, 2014 at 11:59 am

Wowww $1,000 *every* Christmas? That’s huge!! And depending on how old you are now, that $1,000 back then was worth a $hit on more! Your grandfather just became my new hero :)

And interesting about the high net worth financial planner stuff too – I didn’t even think to tap any experts on their opinion. Maybe I’ll hit up some others from our blogging niche to see what they do for their clients – thx man!

Reply

23 Clarisse @ Make Money Your Way October 15, 2014 at 9:07 am

We really want to give our daughter a debt free college. So, as early as now, me and my hubs are saving for her college education that for sure after 10-15 years the college tuition fee will increase.

Reply

24 Retire Before Dad October 15, 2014 at 9:21 am

J$,
I too invest my kids college money in Virginia 529 inVest. Virginia is for Savers, right? I go with VITSX (total market) and VTSNX (international) and the socially targeted fund. Figured I’d take more risk until the kids are around ten years old, then tone down the risk a bit. I’ll probably go to the VASGX at some point too.
-RBD

Reply

25 J. Money October 15, 2014 at 12:01 pm

Virginia is for Savers :)

I like your mentality with the other funds too. I think I had a bias for the fund I was already super familiar with, and since I didn’t choose it for my own investments I thought it was a sign to do so for my kids. I’m usually much more aggressive though – especially when you’ve got oodles of time to grow it – so I bet your route would be an even better fit with my style. I’m starring this to review later when I’m not lazy :)

Reply

26 Retire Before Dad October 15, 2014 at 1:30 pm

Oh, forgot to add… I do include 529 savings in my net worth. I hadn’t thought about that before. I think it makes sense. If 15 years from now there’s $100,000, that’s real money! Sure it will be spent, but spending it will be a great investment.
-RBD

Reply

27 Frugal Buckeye October 15, 2014 at 10:11 am

529 plans are a great idea, and in Ohio we have similar vanguard fund options to choose from as well. I understand where you’re coming from in wanting to make sure both kids accounts are equal. Wouldn’t want to play favorites ;) but the great thing about the 529 plan is that you don’t even need to split the money if you don’t want to. The way the rules are written you can split the money up however you want even after its been invested. You could put all the money in baby nickel’s account and then give it all to baby penny to use if nickel decides not to go to college, or gets those sweet scholarships.

Reply

28 J. Money October 15, 2014 at 12:03 pm

Very true – good point :)

I was actually going to merge both monies into the same account to do just as you say, but then some friends brought up the point of taking full advantage of the tax benefits of having two accounts vs one. So that sold me on just dividing them up – for the future when I can hopefully max out both and actually take advantage :) Plus, it feels good mentally to have them separated out and dedicated to each boy. That way if, God forbid, something DID happen to me at least it’s easy to figure out… Great point though, again.

Reply

29 Money Beagle October 15, 2014 at 10:27 am

The kids college fund balances have never appeared in our net worth. That’s put aside for them. Should they get scholarships, well I guess we would cross that bridge when we got there, but that’s 12+ years away :)

Reply

30 J. Money October 15, 2014 at 12:04 pm

And a much better “surprise” to have later than one where money would LEAVE your net worth out of the blue :)

Reply

31 Lauren October 15, 2014 at 10:31 am

I do not include my daughter’s money in our net worth. Her money is and always will be hers, regardless of our situation. I love that you split up the inheritance that way so that baby nickel is catching up to penny :) Seems fair.

Reply

32 Zach Gray October 15, 2014 at 10:41 am

Don’t forget that you can change the beneficiary of a 529, so it makes sense to have more in the older kid’s 529 and just change the beneficiary to the younger kid on what’s left over in the event the older kid gets more scholarships. That way you can decrease your chances of having to pay the penalty + taxes if it has to be used for non-education purposes.

Reply

33 J. Money October 15, 2014 at 12:05 pm

Here’s my comment from an above person saying similar stuff – which I agree can be beneficial, even though I currently don’t have my own accounts set up that way :)
—–
I was actually going to merge both monies into the same account to do just as you say, but then some friends brought up the point of taking full advantage of the tax benefits of having two accounts vs one. So that sold me on just dividing them up – for the future when I can hopefully max out both and actually take advantage :) Plus, it feels good mentally to have them separated out and dedicated to each boy. That way if, God forbid, something DID happen to me at least it’s easy to figure out… Great point though, again.

Reply

34 Lance @ Healthy Wealthy Income October 15, 2014 at 11:05 am

529’s are awesome, Utah has an amazing plan as well. Investing early is always great. Who goes back and says, “why did I invest and make so much money?” You only hear about people who wished they invested earlier and with more money.

One of the questions I asked with our plan was what happens with the money if my daughter gets a full-ride scholarship (hopeful, but she is 5 after all). There are contingencies for pretty much every scenario I gave them. The write off and growth and low cost funds make it a no-brainer.

Reply

35 J. Money October 15, 2014 at 12:06 pm

Good to know!

Reply

36 Shannon @ Financially Blonde October 15, 2014 at 11:36 am

I would have done exactly the same thing but it’s probably because I am the second child and always felt that my parents gave all of the attention to my brother and I got shafted on everything growing up. We don’t include my son’s 529 in our net worth, because we consider it his money for something. Our parents paid for our college education and we want to do the same. If he doesn’t go to college, and as long as he is gainfully employed, we would likely help him in some other way like a down payment on a home or something.

Reply

37 J. Money October 15, 2014 at 12:07 pm

I’m glad you chimed in here – you were on my list to ping to get an opinion on whether this goes into our net worth or not – thanks :) As someone mentioned above, their financial planner keeps them separate as well, so maybe it’s an industry standard?

Reply

38 Shannon @ Financially Blonde October 15, 2014 at 5:58 pm

I don’t think it’s necessarily industry standard rather more what your use for it is. If you plan to use the money for yourselves rather than your children should they not attend college, then I might suggest putting it in your net worth. Since I plan for mine to go to my son no matter what, it’s really part of his net worth and not mine.

Reply

39 J. Money October 18, 2014 at 1:33 pm

Oh, yeah – good point. I always forget you can use it on yourself!

Reply

40 Brian @ Debt Discipline October 15, 2014 at 11:42 am

We are just kicking off the college saving funds and I do plan on adding them to my net worth updates. I think the 529 is a great place for this found $, the sooner you get build the better, college isn’t getting any cheaper.

Reply

41 Even Steven October 15, 2014 at 12:41 pm

Since you have the funds in a separate 529 plan I would keep them out of the net worth calculation. What about keeping a net worth tracker for the kids?

Reply

42 J. Money October 18, 2014 at 1:35 pm

I think that’s what I’m going to start doing again… I did it for baby #1 when I fist got started, but now w/ the new accounts and mentality I’ll start tracking them both again especially if I end up pulling the 529s from my own net worth. I’ll start including them in the updates for everyone to see :)

Reply

43 Million Dollar Ninja October 15, 2014 at 3:31 pm

I think you did the right thing there by investing it on the little one. I know Penny is your first born, but you can’t treat them as Jamie and Tyrion Lannister. Okay I might have gone too far there, but you know what I’m trying to say.

Reply

44 J. Money October 18, 2014 at 1:36 pm

Haha… over the seasons Jamie is starting to grow on me too – so now it’s a harder choice than it was back in season one (Tyrion is the best character on the show!).

Reply

45 Kayla @ Red Debted Stepchild October 15, 2014 at 3:51 pm

You did what you thought was right and it still went to the benefit of your kids. I think it’s fine :)

Reply

46 Emily @ Simple Cheap Mom October 15, 2014 at 5:03 pm

I think you made a smart decision on what to do with the money and how to allocate it.

I include our little one’s education savings in our net worth.

If you want to keep showing the investments, but not include it in your net worth, setup a “owing to kids” debt that’s the same value of the savings account. You could make an “education savings” expense to balance everything out.

Reply

47 J. Money October 18, 2014 at 1:37 pm

that’s true :) I like the idea of just giving the boys their own little net worths too to track, hehe…

Reply

48 Emily @ Simple Cheap Mom November 10, 2014 at 8:14 am

Just re-read my post, should say I DON’T include her net worth with ours. I feel like we’ve already gifted it away to her.

Reply

49 J. Money November 10, 2014 at 1:42 pm

gotcha gotcha… And as you can see, I’ve now separated this out and each of my kids have their own net worths – woo!

http://www.budgetsaresexy.com/2014/11/net-worth-update-459266-46-3k/

Reply

50 Kathy October 16, 2014 at 9:46 am

Unless your kids are twins, it is ok if the older kid’s fund is higher. You don’t need the full amount on the first day of college, and you have the extra time to bring the second kid’s account up to where it needs to be. However, if you feel better doing it equally then that’s your decision. Putting the inheritance into the college fund is perfectly fine for the terms of the bequest, IMO.

Reply

51 [email protected] October 16, 2014 at 10:09 am

I’ve been curious about this as we haven’t opened accounts for the twins. I’ve read a lot of articles that say other investment accounts far outperform the 529 plans making the tax savings not really worth it but I don’t know. This is why we haven’t pulled the trigger bc we can’t decide. Did you do a lot of research before picking this as your college savings way? Dumb question when put like that but I mean did you almost go with another method?

Reply

52 J. Money October 18, 2014 at 1:41 pm

No, no other options came close to being picked because of the crazy tax benefits w/ the 529. But that’s also because it had similar funds to what I would pick *anyways* regardless of what account it’s in. So I’d check with your state’s 529 first and see if a) they offer tax benefits and then b) if the funds align okay with you, and if either of those are a no, well, sure – maybe other accounts could be better.

But really what other accounts allow the $$ to grow tax free though outside of your personal retirement accounts? You don’t want to pull from those to fund college later, right? So there’s more than just the initial tax stuff to consider too. But any option of saving money for college later is better than not doing it, so at least you’re covered in the grand scheme of things ;)

UPDATE: Just read the comment below yours – that’s an interesting idea, getting the twins their own Roth IRA :) Though you’d only be able to tap the contributions and not all that’s grown over the years since it’s again meant for retirement.

Reply

53 Hannah October 16, 2014 at 12:35 pm

We have a small 529 for our son, and it has been entirely funded by “windfalls”. Although in our case windfalls have been little gifts for him here and there and money from getting a flu shot (not sure exactly how it worked out but I guess my husband signed him up for a clinical trial). As soon as he starts earning any money at all we will start contributing to his Roth IRA instead since I would prefer for him to have the choice of where to use the money (Education, house, or future retirement).

Reply

54 J. Money October 18, 2014 at 1:43 pm

That’s an interesting idea w/ the Roth… though you can only tap contributions and not all the growth until retirement age, which would be a con. Still, could work :)

Reply

55 The Lion's Shares October 16, 2014 at 1:23 pm

I think its amazing that you’ve planned for your kids future, and were able to do so because of your sexy budgeting and investing. How I wish my parents would of done the same! I’m still paying off these dreaded student loans :/

Reply

56 Jeffrey W. Schultz October 16, 2014 at 2:08 pm

My grandmother passed away with I was 13. She left my brother and I 1700 each. My dad put the money in a mutual fund. My Bro spend his when he was 18. I kept mine till I was 25. It had tripled in value. I used it to put a down payment on a house.

Reply

57 J. Money October 18, 2014 at 1:44 pm

There you go! Smart man :) I bet your brother doesn’t even remember (or still have) whatever it was that he bought either.

Reply

58 Ginna October 16, 2014 at 2:52 pm

As the second child in my family, I support your decision. ;) And I don’t have any kids, but I probably would include it in my networth for the same reason I keep my house and my car — they aren’t things I can easily sell or get rid of, but are still part of my total financial “worth.”

Reply

59 KM October 17, 2014 at 1:48 pm

Lucky you! (and your wee ones!) I think bringing both accounts to about even was the right thing to do, especially since who knows when you’ll feel comfortable enough to put a huge chunk of change into the 2nd kiddo’s fund.

Do you ever think about what college, a college degree, and tuition may be like in 17+ years? I don’t have kids (yet), but I often wonder how different it may be in the future.

Reply

60 J. Money October 18, 2014 at 1:45 pm

No, I don’t even bother with trying to guess as it’s too depressing :) Everyone says something different too (and the calculators as well) so I figured we’d just put in as much as we can over time and pray it’s enough.. And then as we get closer sit down and run more estimated numbers. Maybe when we’re 5 years out?

Reply

61 Jayson @ Monster Piggy Bank October 20, 2014 at 5:01 am

When the time has come when I have to distribute my savings and property to my children (I hope I have enough then), I’d make sure their education is settled until college and distribute mine evenly and fairly to avoid this (I am now thinking of drama series where characters fight to get more of what they deserve). Haha!

Reply

62 Steve Kobrin December 5, 2014 at 10:38 am

I love the idea of creating a chain of gifts for generations. Spread the wealth!

Reply

Leave a Comment

Previous post:

Next post: