- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
Preparing and planning for children's future. Could use some feedback.
Posted on 3/21/26 at 12:44 pm
Posted on 3/21/26 at 12:44 pm
My wife and I have been very fortunate. After some rough years financially, the Lord got us out the hole and headed in the right direction. We both have solid incomes. We have already max 2 401ks, dependent care, FSA, etc. We are saving money in a brokerage account. We feel we're doing our part to meet our goals.
We are also trying to put our children in a position to have the freedom to make choices neither their mother or I had. We were focused on making a living. Not what we wanted to do. We both have Masters degrees and are thankful but neither are passionate about what we do.
We have decided to set our children (4,3 and 0) up as much as we possibly can. We're trying tonprovide for the 3 main stages of life: College, Down Payment and Life. Something I've been thinking about a lot recently.
College: I am trying to put $2400-$3000/yr a piece away in a 529 for each kid. My target is $100K or so.
Down Payment: I opened up each a Custodial Brokerage account that I have been putting $200/mo for each one. There is downside to this. They get the funds at 22 but I think the quicker they can buy a home, the quicker they can set themselves up to be successful.
I am really passionate about this because we couldnt buy a home until I was 35. If I would have had 20% down at 25, I'd be in a much better situation. I want that for each of my kids. Or they can just let it grow until theyre ready. I'll keep dropping money into it every month as long as I work.
Life: Now this one I expect to get a lot of criticism for and I want to preface this as I have had trouble getting life insurance due to health and family history. Its been a real problem the last 10 years. I have a 30 year term at $2MM now for me that will take me through 69 but its like $435 a month.
I took out the kids a permanent policy. 20pay $250K. Paid up additions and dividends. Whole life policy. First of all. I don't think its an investment. Just another layer of security for the kids. If they keep it until retirement it could be worth up to $1MM or so. They cash it out as part of my estate...should be worth $500-600K.
Now look. I get the criticism of Whole Life but my struggles getting life insurance for my family really have hit me hard. I also like the portability of it. It's not a great investment but it's another layer of security for Dad knowing his kids' families will be OK long after I am gone.
I don't have any model for any of this. Just a 40 yr old dad trying to figure it out. I don't come from money. I also don't think I know how to handle money that well. I don't really know anybody that does.
Does the above seem sufficient? What do other families do? Any feedback?
We are also trying to put our children in a position to have the freedom to make choices neither their mother or I had. We were focused on making a living. Not what we wanted to do. We both have Masters degrees and are thankful but neither are passionate about what we do.
We have decided to set our children (4,3 and 0) up as much as we possibly can. We're trying tonprovide for the 3 main stages of life: College, Down Payment and Life. Something I've been thinking about a lot recently.
College: I am trying to put $2400-$3000/yr a piece away in a 529 for each kid. My target is $100K or so.
Down Payment: I opened up each a Custodial Brokerage account that I have been putting $200/mo for each one. There is downside to this. They get the funds at 22 but I think the quicker they can buy a home, the quicker they can set themselves up to be successful.
I am really passionate about this because we couldnt buy a home until I was 35. If I would have had 20% down at 25, I'd be in a much better situation. I want that for each of my kids. Or they can just let it grow until theyre ready. I'll keep dropping money into it every month as long as I work.
Life: Now this one I expect to get a lot of criticism for and I want to preface this as I have had trouble getting life insurance due to health and family history. Its been a real problem the last 10 years. I have a 30 year term at $2MM now for me that will take me through 69 but its like $435 a month.
I took out the kids a permanent policy. 20pay $250K. Paid up additions and dividends. Whole life policy. First of all. I don't think its an investment. Just another layer of security for the kids. If they keep it until retirement it could be worth up to $1MM or so. They cash it out as part of my estate...should be worth $500-600K.
Now look. I get the criticism of Whole Life but my struggles getting life insurance for my family really have hit me hard. I also like the portability of it. It's not a great investment but it's another layer of security for Dad knowing his kids' families will be OK long after I am gone.
I don't have any model for any of this. Just a 40 yr old dad trying to figure it out. I don't come from money. I also don't think I know how to handle money that well. I don't really know anybody that does.
Does the above seem sufficient? What do other families do? Any feedback?
This post was edited on 3/21/26 at 1:03 pm
8
Posted on 3/21/26 at 1:22 pm to DiamondDog
You did not mention Roth IRA.
If you are eligible or can do it through the back door, I would fund a Roth IRA for both you and your wife before I did anything in a brokerage account, 529, UGTMA, Trump Account, life insurance, etc. The reason is that you can withdraw Roth contributions at any time, and conversions after five years, and no restrictions after age 59.5, which would probably work well for your youngest child. You can withdraw your Roth IRA (not 401K) contributions and conversions to fund college for your kids, plus give them gifts towards down payments or weddings or whatever, if you've got enough in there to do that. After maxing Roth IRA, then look at all those other things, because you want to teach your kids about savings and investing, that is more valuable that doing it for them.
Doing the Roth first keeps more assets available for all the reasons your family might need it.
If you are eligible or can do it through the back door, I would fund a Roth IRA for both you and your wife before I did anything in a brokerage account, 529, UGTMA, Trump Account, life insurance, etc. The reason is that you can withdraw Roth contributions at any time, and conversions after five years, and no restrictions after age 59.5, which would probably work well for your youngest child. You can withdraw your Roth IRA (not 401K) contributions and conversions to fund college for your kids, plus give them gifts towards down payments or weddings or whatever, if you've got enough in there to do that. After maxing Roth IRA, then look at all those other things, because you want to teach your kids about savings and investing, that is more valuable that doing it for them.
Doing the Roth first keeps more assets available for all the reasons your family might need it.
Posted on 3/21/26 at 1:38 pm to CharlesUFarley
I wouldn't think he qualifies for a Roth based on the above. Backdoor would be an option if not already funding an IRA
Posted on 3/21/26 at 2:03 pm to HailToTheChiz
I just opened a Traditional IRA and I'll start doing the backdoor Roth conversion. I just stick money in the IRA and then transfer it to the Roth? Seems simple.
Posted on 3/21/26 at 2:16 pm to DiamondDog
Be aware of the prorata rule. If you have significant existing traditional IRA assets, like a rollover, it can create additional taxes. If you don't have any other IRA's, you're good. If you do have IRA's but there isn't much money in them, just convert them. 401K is different.
At least at Schwab, conversion is as simple as moving funds from one account to another.
At least at Schwab, conversion is as simple as moving funds from one account to another.
Posted on 3/21/26 at 2:30 pm to DiamondDog
Sounds like you are doing everything you possibly can. Without getting into details at your age at 40. Sounds like you got a late start on saving.
I would suggest look at your retirement goals and make sure you focus on your retirement first before saving extra money for your kids.
I would suggest look at your retirement goals and make sure you focus on your retirement first before saving extra money for your kids.
Posted on 3/21/26 at 2:53 pm to UltimaParadox
Agreed. Great plan overall, but take care of your retirement and widow money. The kids can inherit any leftovers…try to save sufficiently for that to happen. 
Posted on 3/21/26 at 2:53 pm to DiamondDog
You might also want to take a look at the new trump accounts. They can be converted to an IRA when your child reaches 18, which is also likely to be the point of their lowest income in their adult life, which means lower taxes on Roth conversions. It might be a huge opportunity to build a high Roth IRA balance early in their life. It's too early to tell exactly how all that is going to work, but since the intention is to convert the Trump account to an IRA at age 18 and apply IRA rules thereafter, it is possible that a kid could start out their working life with a 6 figure Roth account that they can use to buy a house in five years assuming the same IRA rules apply to conversions, or maybe they retire young.
529 allows for limited Roth rollovers, but not like it looks for Trump accounts.
529 allows for limited Roth rollovers, but not like it looks for Trump accounts.
Posted on 3/21/26 at 6:59 pm to CharlesUFarley
Proceed with a lot of caution with aggressively funding the new Trump accounts. Upon conversion to Roth, earnings are taxed as regular income. 529 to Roth conversions aren't taxed. Of course, take full advantage of any free $ for Trump accounts if kids are eligible for free seed $ or matching from your employer etc
Eta: Got me thinking about using Trump account to fund extra $5-10k Roth contribution for a 17 yr old with little/no tax consequence upon conversion at 18 (like a backdoor Roth). Already plan to match contributions from any earned income as teenagers to fund their Roth IRA early.
Eta: Got me thinking about using Trump account to fund extra $5-10k Roth contribution for a 17 yr old with little/no tax consequence upon conversion at 18 (like a backdoor Roth). Already plan to match contributions from any earned income as teenagers to fund their Roth IRA early.
This post was edited on 3/21/26 at 7:55 pm
Posted on 3/21/26 at 7:52 pm to CharlesUFarley
quote:
Be aware of the prorata rule. If you have significant existing traditional IRA assets, like a rollover, it can create additional taxes. If you don't have any other IRA's, you're good. If you do have IRA's but there isn't much money in them, just convert them. 401K is different.
At least at Schwab, conversion is as simple as moving funds from one account to another.
I also think any brokerage will walk you through the backdoor process as well
Posted on 3/21/26 at 8:32 pm to DiamondDog
Shoot, if interest rates go up when they are looking to buy, they may be able to take the money you’ve saved for a down payment and the cash value of the whole life insurance and take a loan out to buy a house outright. Then have a “mortgage” that they control, compounds annually and not daily, and the principle of the policy keeps growing as if nothing happened.
A lot of value in a properly set up whole life policy.
A lot of value in a properly set up whole life policy.
Posted on 3/21/26 at 11:21 pm to DiamondDog
shite it sounds like you got it figured out…
Just trying to survive over here… student loans for daughter as of now.
Son isn’t the college type so gonna be a hard road for him.
Idk… I make decent money but can’t get ahead, I don’t get it. Putting into my 401k, not max though. Barely making it check to check after dropping a little cash into savings (which gets ate up continuously- car repairs, kids extracurriculars,try to take family on a (non extravagant trip once per year)
It sucks. Especially looking around at others inn$70k tahoes , going skiing in the winter, and th Caribbean in the summer). I know they don’t make that much more than me.
Almost ready to give up
Just trying to survive over here… student loans for daughter as of now.
Son isn’t the college type so gonna be a hard road for him.
Idk… I make decent money but can’t get ahead, I don’t get it. Putting into my 401k, not max though. Barely making it check to check after dropping a little cash into savings (which gets ate up continuously- car repairs, kids extracurriculars,try to take family on a (non extravagant trip once per year)
It sucks. Especially looking around at others inn$70k tahoes , going skiing in the winter, and th Caribbean in the summer). I know they don’t make that much more than me.
Almost ready to give up
Posted on 3/22/26 at 7:20 am to UltimaParadox
quote:
would suggest look at your retirement goals and make sure you focus on your retirement first before saving extra money for your kids.
Well I learned valuable info about the Roth from this thread. It won't affect any of the above for my kids but I do plan to contribute the max to the Roth.
Thanks guys.
Posted on 3/22/26 at 7:26 am to xBirdx
Kept pushing. You’ll eat goals intime. You’re far and away ahead of many, I can assure you.
Posted on 3/22/26 at 9:07 am to DiamondDog
Great story. There are many ways to financial success, and good planners like you will make it happen. Stay forward thinking like you have been.
You didn't mention your age, but think using Roth's is the main thing you are missing. If you can leave money in a Roth for 20+ years, then find a way to fund a Roth.
You and I differ on life insurance. I always carried smaller amounts to allow more money for other investments. I allowed a 20-year term policy to expire at age 58, and have had none since. No regrets. I no longer need it. Since we never know if we will use life Insurance ahead of time, nobody can really speak to what is the right approach for you. It is a guessing game. $435/month sure is a lot of money. Your personality and life experiences brought you to your mindset, and is what it is. I would suggest that you reevaluate later in life once you attain a very comfortable level of wealth. You might prioritize life insurance at a lower level then.
I would suggest you start funding a Roth for each kid now. Since the earnings in a Roth grow tax free, the numbers get impressive when allowed to grow for the number of years that you kids will likely have. Research what $10k becomes after 40 years of growth in a Roth. I would suggest that funding a Roth might be a better choice than a 529. Others might not agree. I would fund both, even if it means putting less in a 529.
My brother aligns with you on life insurance, and no amount of discussion will change his mind. He leans into the sentiment of what if one dies unexpectedly. He has a strong plan if this happens. The other side of the argument is what if one lives a long life. From that perspective, you could consider using some of the money going to life insurance for your kids to fund a Roth for them at a time when the money could grow 30, 40, or 50+ years. You could literally fund their retirement before they become adults. That is good parenting. And you clearly are a good patent. Good luck!
You didn't mention your age, but think using Roth's is the main thing you are missing. If you can leave money in a Roth for 20+ years, then find a way to fund a Roth.
You and I differ on life insurance. I always carried smaller amounts to allow more money for other investments. I allowed a 20-year term policy to expire at age 58, and have had none since. No regrets. I no longer need it. Since we never know if we will use life Insurance ahead of time, nobody can really speak to what is the right approach for you. It is a guessing game. $435/month sure is a lot of money. Your personality and life experiences brought you to your mindset, and is what it is. I would suggest that you reevaluate later in life once you attain a very comfortable level of wealth. You might prioritize life insurance at a lower level then.
I would suggest you start funding a Roth for each kid now. Since the earnings in a Roth grow tax free, the numbers get impressive when allowed to grow for the number of years that you kids will likely have. Research what $10k becomes after 40 years of growth in a Roth. I would suggest that funding a Roth might be a better choice than a 529. Others might not agree. I would fund both, even if it means putting less in a 529.
My brother aligns with you on life insurance, and no amount of discussion will change his mind. He leans into the sentiment of what if one dies unexpectedly. He has a strong plan if this happens. The other side of the argument is what if one lives a long life. From that perspective, you could consider using some of the money going to life insurance for your kids to fund a Roth for them at a time when the money could grow 30, 40, or 50+ years. You could literally fund their retirement before they become adults. That is good parenting. And you clearly are a good patent. Good luck!
Posted on 3/22/26 at 9:25 am to KWL85
So very interesting point you brought up. I am 40 with 3 kids under 5. The $436 a month is worth more to me now because if I drop dead, we arent nearly prepared for retirement.
If I die, I hope its a single car crash. She'd collect about $7MM across all possible insurance lines lol
Anyway, my term policy is also a hedge for retirement for my wife if I die between 60-69. It still provides her some additional cushion.
To me, life in my situation, is a necessary. I pay that $436 a month happily. Ive been turned down plenty.
I did what I will do for their life/retirement with their 20pay policies. That can fund their retirement or bridge their inheritance.
I might stick $100 a month in their Roth. Who knows. Let me get mine set up and we will see.
If I die, I hope its a single car crash. She'd collect about $7MM across all possible insurance lines lol
Anyway, my term policy is also a hedge for retirement for my wife if I die between 60-69. It still provides her some additional cushion.
To me, life in my situation, is a necessary. I pay that $436 a month happily. Ive been turned down plenty.
I did what I will do for their life/retirement with their 20pay policies. That can fund their retirement or bridge their inheritance.
I might stick $100 a month in their Roth. Who knows. Let me get mine set up and we will see.
Posted on 3/22/26 at 10:13 am to DiamondDog
Im not a fan of the whole life.
But it meets your personal goal, today.
If both you and your wife have life insurance covered, an underwriter should approve a 40 year term on your kids at age 18 (but they have to stay healthy by age 18 to qualify. That is what you have protected with their whole life policies).
I understand why you chose your path. I generally prefer my future values to be investments and not life insurance.
But it meets your personal goal, today.
If both you and your wife have life insurance covered, an underwriter should approve a 40 year term on your kids at age 18 (but they have to stay healthy by age 18 to qualify. That is what you have protected with their whole life policies).
I understand why you chose your path. I generally prefer my future values to be investments and not life insurance.
Posted on 3/22/26 at 10:31 am to DiamondDog
This all seems pretty much SOP.
You’ll want to convert it to something different when they hit high school. Reading the OT, everyone’s kid seems to get a scholarship money to study out of state. But, my experience has been that as soon as you disclose a six figure savings account sticker price is applied.
Conversely, if your kid is targeting elite schools, you can reduce your income by directing the funds to an LLC or more preferably a non-profit which helps boost his leadership skills for extra curricular activities.
A lot of students are currently using non profits, IP, and patent creation to improve their applications. If you want to get really clever, you could use the funds in the LLC to hire a ghost writer to publish a book in your kid’s name.
If the headache of running an LLC is your kid’s name isn’t an issue, you can also use it as a launch pad to justify contributions to his Roth..which will have a material impact, and he can’t do anything stupid until he’s 59 1/2
You’ll want to convert it to something different when they hit high school. Reading the OT, everyone’s kid seems to get a scholarship money to study out of state. But, my experience has been that as soon as you disclose a six figure savings account sticker price is applied.
Conversely, if your kid is targeting elite schools, you can reduce your income by directing the funds to an LLC or more preferably a non-profit which helps boost his leadership skills for extra curricular activities.
A lot of students are currently using non profits, IP, and patent creation to improve their applications. If you want to get really clever, you could use the funds in the LLC to hire a ghost writer to publish a book in your kid’s name.
If the headache of running an LLC is your kid’s name isn’t an issue, you can also use it as a launch pad to justify contributions to his Roth..which will have a material impact, and he can’t do anything stupid until he’s 59 1/2
Posted on 3/22/26 at 3:58 pm to lsuconnman
quote:
Conversely, if your kid is targeting elite schools
I do know a little bit about this. Unless they are going high finance or a specialization in undergrad, there really is no difference in any college outside the Top 20 or so schools. Maybe less than that.
Their nut should be spent going cheap on undergrad and high dollar on Masters IMO.
There aren't many schools you can't bounce your way to from LSU.
This post was edited on 3/22/26 at 4:00 pm
Posted on 3/22/26 at 4:37 pm to lsuconnman
quote:
A lot of students are currently using non profits, IP, and patent creation to improve their applications. If you want to get really clever, you could use the funds in the LLC to hire a ghost writer to publish a book in your kid’s name.
If the headache of running an LLC is your kid’s name isn’t an issue
Establishing an LLC with an EIN is easy. Can you expound a little more on this? What kids are creating IP without ChatGPT and what are they filing patents on? Non profits doing what?
Page 1 of 2
Popular
Back to top
Follow TigerDroppings for LSU Football News