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Roth IRA for Adult Child

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  • Craigy Craigy 
    Participant
    Status: Spouse
    Posts: 2059
    Joined: 09/16/2016

    He wasn’t going to contribute any of his money at all.  The idea behind it was for me to contribute to it throughout the year when I could plus take the money I was already collecting from him for car insurance and put that in there.

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    Ahhh.  Well if it really is free money with nothing extra out of his pocket, then perhaps that wasn’t made clear to him?  Seems like a no-brainer.

    LEVEL 1 WCI FORUM MEMBER.

    #43411 Reply
    Avatar jasonhines 
    Participant
    Status: Other Professional
    Posts: 11
    Joined: 04/05/2017

    That’s what I thought too but he is in that control phase now.  19 years old and wants to cut the cord while I’m trying to help his future self out.  I’m going to just put the money aside and if he comes around, I’ll toss it in a roth.

    Indecision doesn't create change. Only action does. Do something today to get you closer to your goals.

    #43413 Reply
    Avatar adventure 
    Participant
    Status: Spouse
    Posts: 1186
    Joined: 10/24/2016
    I think it’s a great idea. Just have the statements come to your house

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    Or to an email, so there isn’t any paper!

    (side note, I have one financial institution that won’t stop sending paper. I loath it, and want to dump the account, just because sending paper is a stone age requirement. Ugh). Any requirement to use paper is arcane, insecure, and just stupid.

    #43553 Reply
    Avatar NYCdoc 
    Participant
    Status: Physician
    Posts: 32
    Joined: 08/24/2018

    Also beware that you can’t contribute more than his earned income each year, so he has to earn at least $5,500 for you to max it.

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    quick question: let’s say my kid made $2500 this year and she had to pay ~$200 to SS and medicare. can she contribute $2500 to the Roth IRA or only $2300? thanks!

    #240642 Reply
    Avatar jacoavlu 
    Moderator
    Status: Physician, Small Business Owner
    Posts: 2382
    Joined: 03/01/2018

    IRA contribution is limited to compensation, as an employee that is W-2 Box 1

    The Finance Buff's solo 401k contribution spreadsheet: https://goo.gl/6cZKVA

    #240677 Reply
    Avatar JBME 
    Participant
    Status: Spouse
    Posts: 533
    Joined: 03/26/2018

    2500

    #240679 Reply
    Avatar Crazyroadtodublin 
    Participant
    Status: Physician
    Posts: 77
    Joined: 03/08/2016

    I think this is one of the greatest ways to determine how an individual will handle an inheritance.  I like thinking of it as a micro test.  If my son blows through the ira, the trust can be revised accordingly.

    #240699 Reply
    Faithful Steward Faithful Steward 
    Participant
    Status: Financial Advisor, Small Business Owner
    Posts: 519
    Joined: 06/12/2017
    I’m trying to help my son kick start his retirement but want to hide it from him.

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    Your son is going to have to sign the Roth IRA application. So, you’re not going to be able to hide it from him.

    Michael Peterson, CFP® | Faithful Steward Wealth Advisors
    https://ProsperousPhysician.com | (717) 496-0900

    #240732 Reply
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    Faithful Steward Faithful Steward 
    Participant
    Status: Financial Advisor, Small Business Owner
    Posts: 519
    Joined: 06/12/2017
    I think this is one of the greatest ways to determine how an individual will handle an inheritance.  I like thinking of it as a micro test.  If my son blows through the ira, the trust can be revised accordingly.

    Click to expand…

    This is a great idea. Thanks for sharing!

    Michael Peterson, CFP® | Faithful Steward Wealth Advisors
    https://ProsperousPhysician.com | (717) 496-0900

    #240735 Reply
    Avatar Anne 
    Participant
    Status: Physician
    Posts: 1175
    Joined: 11/07/2017

    I was going to comment for the OP but then saw this was from 2017.

    OP if you’re still out there give us the update–how is your son doing? Still planning to go to Med school? Still refusing free money?

    #240739 Reply

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