This week I’ll play off of last week’s episode on college selection by going back a little further. Specifically, back to when your child was born. I was recently talking to someone about the power of compound interest and how early our kids can start saving for retirement. It sounds weird to talk about 16-year-olds saving for retirement, but we know the power of compound interest. What if there was a way to start saving at birth? Listen in as I go over the concept of the Baby IRA.
You will want to hear this episode if you are interested in...
The concept of the Baby IRA [1:14]
The bigger issue of taxes [2:46]
What if the Baby IRA really did exist? [4:00]
The sales tip section: Vision Boards [5:53]
This week’s GenX FLASHBACK [11:23]
Not your run of the mill Uniform Minors Acts
You might be thinking… Aren't there already savings vehicles for minors like Uniform Transfers to Minor Acts (UTMAs) and Uniform Gifts to Minors Acts (UGMAs)? Yes, these savings methods do exist, however, there is a huge difference between these and the Baby IRA concept. Taxes, of course, UTMAs and UGMAs are both funded with after-tax dollars. The funding is coming from the parents because most one-year-olds are not dealing with taxable income.
The bigger issue is taxes on earnings within these accounts. Check out the episode to find out more about this interesting concept.
The sales tip section: Vision Boards
If you're like me as the end of the year rolls around you start thinking about what you want to accomplish in the upcoming year. I usually spend a few days in the woods in the fall to think and envision the future. Which leads me to vision boards. I’ve created a few in the past and I think the act of doing it is more valuable than the actual finished product.
If you've never done this, you may be wondering exactly what it is. It’s simply finding words and images that motivate you and attaching them to a board to keep you inspired throughout the year. The images are related to your goals. Maybe you want to buy a new car or house, or fully fund the kid's college, pay off all your debt, or even take a great vacation. Whatever you want to achieve should be represented on the board and displayed where you will look at it often to keep you focused on what you want to accomplish. It’s that simple.
This week’s FLASHBACK: CDs and I don’t mean the savings variety
Today is a GenX flashback! What is your favorite way to listen to music? I'm not an audiophile, speaker head, or whatever term applies to audio system purists, I am simply talking about what I think is the best way to listen to music. For me compact disks, or CDs, is where it’s at. Don’t get me wrong I love my record collection and my Spotify account but nothing beats the sound of a CD to me. Why? I prefer to listen to my music without the distortions that come with vinyl. I get there are certain things you can only pick up on vinyl and it's very authentic, but my hearing's not good enough to even tell the difference. Streaming is convenient but the music is so compressed. Personally, if I'm going to rock out, I need my CD player and some solid speakers. What about you?