4 Life-Changing Investment Accounts That You May Not Know About!

four counts you might not know about that could change your financial life it's Brian Preston the Buddy Guy so here's nothing is so great right that sounded like clickbait right like oh that's not really this really is true like for if you're someone who has the ability to use these accounts and you fall into this category it is something that can quite literally be life-changing and I think that's amazing and I think you know how I know people don't know about a lot of these because we get emails all the time hey can you tell us about this or hey I heard about this thing or hey what is this I just love when we can open people's eyes to things they might not know that's the whole reason we do this show and I think each one of these accounts well I love that we do highlight episodes where we can break out into small digestible chunks I think you eat one of these is gonna be able to stand on their own and be something that can for years be a resource to people as well by the way if you're just now tuning in this is the money guy show go to money guy calm if you want to get show notes if you want to give us your email address as well as your zip code just in case we want to drop into your neck of the woods that's how we're gonna stay connected with you so go to money guy calm also you probably noticed right behind us in studio we have a YouTube ticker that if you want to subscribe you can you know we will keep that number going up and then we do a live stream every two weeks on Tuesday even though we're recording this on Monday currently so make sure you subscribe and then also even click the little bell button so you get notifications whenever we do have updates or things going on with our YouTube channel love it so let's I mean by the way I didn't even ask you but when I was putting these four together we didn't talk about order mm-hmm so I'm willing since we're doing this on a Monday we're doing a doubleheader where we're doing two live episodes at once that we're recording in the live streaming do you want his name which accounts you think should have been named first or do you want to just go in the order I have them or do you have it is actually fantastic I do want to say what the four accounts are on the onset so everybody knows the four we're gonna go talking about and then I think we should go in this order because I just love the way you've done okay you do the setup with the four accounts and then I'll kind of jump into the first so the four accounts that we think that you also know about that you might not know about our able accounts health savings accounts dependent care flexible spending accounts and then custodial Roth or minor Roth accounts minor Roth IRAs so you're ready let's just hit it let's talk about able first cuz I feel like that's the one when you talk about something being life-changing I feel like this is one that's a little new a little unique but has huge impacts for those for those who have touches um just so you guys know I this one is is a that's why I think the reason I just asked you which one you do first is I didn't know if this one was appropriate just because I'm in a great mood y'all should know last week I had the full-blown flu was in bed for a number of days so now that I'm above-ground again and I'm like I feel even though I have this annoying cough and this Stevie Nicks gravelly voice I'm just happy to be alive so I'm just full of energy but this one I mean I will tell you that this one hits hard and close to home for me is cuz I think a lot of you guys out there money got family know I have a special needs daughter I have a daughter that was diagnosed with autism and um she goes to a special school for it we don't know and it this is the part that I got kind of you know bother you know and that bothers me but it's just hard to share we don't know if she'll ever live alone sure I mean is just the reality of the situation is she progresses much slower than a neuro normal child would on the way they process the world now I wouldn't change her at this point because she is special in her own unique way anybody who meets her I always say that she's got this x-factor that every teacher who meets her wants to adopt her story she's cute as a button she's mischievous in just enough way that it's actually fun she's just she's my buddy I'll just say that so able accounts when you know when you have a special-needs kid your entire life changes because a lot of your expectations of accomplishments or things of benchmarks of you know checking the boxes off in life just kind of change a lot and even even for my wife and I when we start thinking about traveling the world other things we realize there's probably somebody else with us you know that we gotta have to either make arrangements for you know for you know to come somebody to help out or should just go travel and see the world with us and we've even got some ideas on that for the future too but a lot of that if you're a normal person you're like I don't deal with all this I mean cuz there's going to be I'm not gonna be here forever so how do I make sure all my financial goals are fulfilled who's going to to help this special person out when I'm not here and it's a little overwhelming yeah so the first thing you think of is like a special needs trust well that's the traditional idea a special state attorney they're going to help you structure these things and you set up as a special needs trust which still very well could be something that you might need to consider but I loved when I found out about these things it was like an answer prayer because this thing I'm telling you guys if you have a special needs kid you gotta know about able accounts because these things are built upon the exact same platform that has been so successful which is the 529 s we all know 529s are incredible resources for saving for your kids college and why do we love saving for our kids college and 529s as well as for K through 12 private school now by the way to is because if you use them for what they're intended for meaning for education they grow completely tax-free which is acceptable so your your contribution goes in you might even get a little bit of a tax benefit off of it the earnings grow tax-free and then when you pull it out for educational purposes is tax-free well the same thing for able accounts they're built upon that same platform so that if you could imagine you could save up to $15,000 a year in 2019 and that money can grow it can keep working for itself but then when you eventually need to pull that money out to pay for expenses of life of living with a disability the principle and the growth is going to be complete nice right tax-free and the set up for these things is pretty much nothing not say I think is a special needs trust like we've mentioned an attorney we mentioned you're gonna need advisers and others to kind of help you structure all these things these able accounts are administered by the states to Klee just like the 529s they work with partners and they set these things up so it is truly a godsend and a blessing for you if you're dealing with these type of struggles you need know about and here's the other key thing that a lot of people are excited about with able accounts that I'm even I have an update but I need to share this with you there's legislation going on right now those in just introduced in Congress that impacts these that might even be more updates coming with able accounts but a big concern also when you have a special needs child the eventual will be a special needs adult is you're worried if the savings you do is going to blow up the governmental benefits yeah hoping that they have access to because lord knows you know think about the ears will always tell people I have to save for my retirement and then I have to save for Emory's well-being so since we're saving for two families and you'd like to think well gosh that's a big responsibility wouldn't it be nice if we still you know it when she gets out you know in the future down the road if I'm not here my wife's not here if maybe she qualified for the Supplemental Security income the SSI what if she could get some of the the supplemental nutritional assistance program the SNAP program Medicaid Medicaid well if you goes if you go set up just accounts in this child's name you're probably gonna get precluded because some of these things go away at $2,000 right I'm not saying $2,000 a month I'm saying at $2,000 all these things go away not with able accounts they give you on the SSI which is a Supplemental Security income you get an exemption exemption up to $100,000 but then a lot of these other things like Medicaid and so forth they just don't count people accounts really so you could if you're saving $15,000 a year maybe this thing's going to be worth you know a million dollars short million dollars don't worry it you would still be able to use this well there are potential clawback provisions but there's legislation that potential legislation there might even work on that here's a key thing about able accounts because a lot of you guys are starting to get excited you're like well man maybe I'm qualified for this and it was even I saw an article and said what about military veterans who have been disabled from service so they qualify for able accounts currently legislation is you have to have the disability diagnosis 26 or before before age 26 that's and that's that's a big limitation so guess what there's legislation this is hot off the presses this is March of 2019 there is bipartisan legislation how awesome is here bipartisan legislation mean you've got Democrats and Republicans working together where they're trying to push that age up to 46 so potentially that age of 26 will be pushed up to 46 and able will be opened up to more people today you also you don't have to be receiving Social Security to get able a qualify for able you just have to have a medical professional who is saying that this will be an ongoing struggle in an issue and you're willing to keep initial responsibility to keep that documentation that you do qualify for able I'm trying to think about because I've thrown so much I think one of the unique things and we actually had a listener comment on this that it's not just for contributing for minor child but you yourself if you're disabled or if your child is they work and they can also contribute to it as well that's that's part of the new 20 you know part of the new tax reform that came out it guess you know 2017 that was part of it it just took effect in 2018 is that part of the new legislation with able accounts also is that you get to put in $15,000 to $15,000 a year by the way if you're wondering where that number came from that's a you know gift amount if it goes up next year for because it's indexed for inflation the able amount will go up as well but realize that if the part of the the tax reform is that if that child is working like we have a restaurant we go to for one to probably three times a week there's a special needs child an adult that works in there and we've gotten to know it yeah and it's great because he knows us and I'm very very sensitive and make sure I know his name always you know give him a high-five or a fist bump and he works at this restaurant you know and he takes food and he clears tables and other things he would qualify every earned income dollar he earns could also be contributed to his able account on top of the $15,000 the only exclusion of that though is if there's a retirement benefit no longer can count that money right so if your employers making retirement contributions on your behalf unfortunately that income no longer qualifies to do the able account it's one of the things that we were talking about Brian debt where these are a little bit different than 529 accounts is that beneficiary can only have one able account right so it's not where you can set one up and the grandparents they do that when I have 29 for education these able accounts get one account okay and it's 115 thousand dollars oh so if you want to put in ten thousand the grants $15,000 and you also need to pay attention I mean I don't think this is a big deal because when I first did my first show on able accounts the funding limit in in Tennessee was maximum contributions of 235,000 not over the life of the I'll future not the value of the account but just contribution total couldn't exceed two hundred thirty five thousand as of this year 2019 it's three hundred fifty thousand are obviously indexing this for inflation for most states it's around three hundred thousand you need to I want to give a website I feel mad that I haven't done this already if you were interested in able because we're going to move on to these other four categories other three accounts I want you to go to able in RC dot o-r-g able in RC o RG these guys have an incredible website that's a resource even let you there I think we're up to 42 43 states that have able account availability in them and actually if your state doesn't there's other states that probably will allow out-of-state residents to come in I think Mississippi I think the Dakotas there's a few that just have not quite got these Able's set up right but most of them do have set up but you do need to pay attention that's what this account this will website will tell you is like Tennessee they don't want outside residents so you only can contribute to the Tennessee plan if you live in Tennessee so with like with 529 plans it's pretty specific you to use the expenses for qualified higher education so you get an error I guess K through 12 now I got to pay for school and wherever be permissible do the able accounts also have that same sort of restriction on how you can actually use it I mean what you say you grow this up to it where it is a million dollars is it limited on how you can use those funds it is supposed to help you with dealing with a life with a disability so it is very broad in the way the language is written I mean it even can pay for administration it can pay for living expenses that can pay for so how is there rent food I mean it's a lot of it because they look realize when your special needs and a special needs adult especially everything is going to be somewhat of a struggle so I think that their per they wrote the flexibility in the legislation for that purpose it's really outstanding great question Bo but I think that that's an important part what would it down leave because I get so emotional I get so energetic and passionate about this because it does hit me directly I just want people if you don't you have a special needs person go hone up on this resource and Mayo how to use it you know one planning opportunity that we had talked about bran is a lot of a lot of parents when they first have a child they do they want to get out in front of planning's they say you know what I'm gonna start funding a 500 on account from the time that my child is born I'm start saving for college saving for college saving for college well you're in a situation where you found oh there's this able account aren't there some unique there's there's some unique transactions you can do even between like college savings accounts 529s and able accounts right great way to close out because I had to left that point out you can rollover your college 529 accounts into an able account that is that's an incredible opportunities look some of these diagnosis is you just don't know like with autism you know you might not know until 2 3 years old that the child is is has this and you know it's just something and here's the thing when I first said this account I didn't know what Emrys future was sure you were getting a few more years into it it still looks like she might need assistance for the rest of her life you know I'm glad we're making these decisions I'm loading this bad boy up for all it's got because I wanted to give as much opportunity to her as possibly you know if you're somebody out there is listening to us on stitcher I Heart Radio iTunes fill in any of the other audio ways that people listen to us one of the great things about being able to do this live stream and having an audience right here ask us questions is sometimes we might say something that's not incredibly clear you might just have a follow-up question and we actually have access to that and this was a great question and it just came through it says hey I'm working and I have a 401 K or you say that I can't contribute to the able account and I just made that correctly no what I'm saying is is there's a new provision within the tax law for able accounts that when the special-needs child becomes an adult and so they only have to be an adult when they start having earned income if they go and get a job in the community that there's a special provision that there they can make contributions to their own able account up to their you know up to their earned income and that doesn't count against the $15,000 that you can put in just as the annual limit so long as they're not retirement plan contributions for them in their working situation so for instance the the example I made was the gentleman who works at the restaurant that Bo and I go to for lunch all the time he if he was at if his employer is making 401k contributions on his behalf he could no longer count those contributions so it has to do with the actual know that individual themselves not the parents that's a great question I'm so glad that we had a chance if I because I always try to say why didn't why they write that into it because I always try to explain tax a lot of people it's probably because if they're letting the employer count that portion of income to take a deduction for the matching contribution they didn't want to double double dip opportunity that to be created okay so that's that's the first one the first account we just cover one able account that's a big one are you good yes that one that one's close to home and hits so I'm glad we now let's move on to the next ones the second one is one that I'm really really excited about and here's the thing this isn't one that we haven't talked about before we've actually done an entire dedicated shows to this before but it is that good and it is that powerful it is that big it is that unique that it's worth mentioning on the show because if you aren't taking advantage of it you might be missing out on a huge huge huge planning opportunity because dare I say there is no other financial account out there like this financial account and that no this one this one's big here it is triple not one triple tax advantage that's right yeah what do I say triple tax advantage boom yes so what's really unique is not only do you get a tax deduction with adduction on the front that's one not only gonna text a duck run in deduction it grows tax-deferred as jr. you don't pay taxes on it but then when you go to pull that money out if you're using it for qualified medical expenses you actually pull it out tax-free boom number three that's triple tax advantage I mean guys government is trying to tell you health care is going to be a big deal get your act in order and save for health care and here's why I do that I updated this number Bell we didn't pulled this this was from fidelity fidelity every year does a a cost analysis of what rich healthcare is going to cost retirees in the future and the 2018 report that fidelity prepared said that healthcare was good cost approximately for a 65 year old couple two hundred and eighty thousand dollars throughout their retirement I think that's worth repeating cuz that number you just thought was over a quarter of a million dollars right just for health care just for a higher over a quarter million for a couple so we need to get serious about how do we save so why not figure out a way that the government's going to subsidize those contributions and make it work for you so that's why we want to make sure you sleep well at night and understand the triple tax advantage it's also one I consider one of the greatest legal tax loopholes out there but kind of go through the ins and outs of how these things work on contribution limits and then I want to talk about this cool saving strategy that I'm doing this kind of taking advantage of some some vagueness in the the reimbursement laws yes so the very first thing that you have to be able to to know is am I eligible to contribute to the health savings account because we've actually done shows before and we've had folks reach out to us and say that we man we love this health savings account I want to do it can I do it and our answers you can only take advantage of a health savings account if you're covered under a high deductible health insurance plan so there's a very real chance that through your employer you may be in the Cadillac plan really low deductibles you just have co-pays really great insurance you may not be someone who qualifies a bill to make HSA contributions conversely if you and your spouse are on different insurances and maybe you are on a high deductible plan and your spouse is not only you can contribute and your limit your contributions are limited relative to what the household can but if you're an individual and you want to make a contribution in 2019 you can contribute up to thirty five hundred dollars for a single coverage or if you have family coverage you can contribute up to seven thousand dollars for your family and if you're over fifty five there's a thousand dollar catch up it's just an incredible opportunity of you are probably going well high deductible plan what does that mean well I could give you all it does exactly as the name implies it means you're probably gonna bear a lot more of the cost you're essentially paying for the discount network of your insurance company but because you know you're okay with that because there's gonna be this triple tax advantage and you're going also have some additional savings and then the insurance company's gonna give you some savings they know if you're bearing some of the costs of the health care they're gonna hopefully give you lower premiums this is how this is all supposed to work together I can give you what those high deductible limits are but they change every year the easiest thing I would tell you to do and it's just so easy you have to be careful just because you look at an adduct will you go man that's a high deductible and that insurance plan that does not make it HSA eligible what you have to do is kind of look in the literature and it's gonna be very prominent or ask the person that's it's you know if you're in a group plan ask the benefit benefits provider your HR department if you're buying an individual plan out there in the marketplace you can very easily they will tell you if their HSA eligible that's right it's not just oh my god that's a hot adductor bone that one let's that's it that's age it's gotta be it just doesn't work that way there's actually some specifics that it's got to make sure it fits into and we want to make sure you fall into that so one of the things that we talk about is so there are a few there are a few ways that you can use an HSA account so if you are subject to a high deductible plan you can make the election to put money into the HSA you can either do it via your paycheck which means that just like your 401k contributions or any other cafeteria contributions it just comes out pre-tax out of your paycheck or you might be in a situation where you can make direct contributions with after-tax dollars into an HSA and then claim it on what used to be page one of the tax return I think it's like schedule one or maybe it's page one I'm kind of confused now but it's one of the early pages in the tax return and you can claim that well you can use those funds this year as you put them in to go pay for health expenses so I put in a hundred dollars a month and then in a couple months I go to the doctor and it cost seventy bucks I can just pull 70 bucks out of my HSA and pay for my doctor visit and I can use that as a way to reimburse me for medical expenses the other way you could do it though is you can actually use it as an investment account there are a lot of really great providers will mention a few where you can actually put that money to work and invest it in really low cost index funds sometimes target retirement funds and let that money grow into the future and that's so that's the key thing because we were already talking about the triple tax advantage but the key part is that you can invest a portion of this now I want to protect you guys money got family is thing if you're a person that you need this HSA account to actually pay for the health care reimbursement the expenses that you're having then the big part is you probably want to keep a lot of those initial HSA contributions liquid it's okay to stay in the cash holdings make sure you're earning something and probably keep enough cash to cover the deductibles are the Rocketman amount because that's probably really what you need to pay attention to is what is your out-of-pocket limit for the year make sure you have enough money in that account to cover that so you never get caught nekkid you know on if you did have a medical experience happen now you're what you're hoping is that your two your three your four things aren't haven't happened to you medically so this money's just built and once you have that deductible covered or that out-of-pocket that covered now let's figure out how do we how do we maximize opportunities here it's a call to investing the money so you depend upon the eight the custodian that you for your HSA you have the potential to invest in like Vanguard or really low-cost index funds it's an incredible opportunity so much of an incredible opportunity here's something that I'm doing I use my HSA and I make sure my wife knows whenever we do anything that qualifies for reimbursement we keep the receipt okay we're keeping those receipts I document those receipts I scan those receipts in I'll organize those receipts so we can always come back to them and know where they reside to come to them in the future and that's a key important thing is because we are keeping records of all of our expenses but we're not seeking reimbursement well I thought the whole cool thing about this was you get some reimbursement Brian why on earth would you not get out of our expenses we're letting the money grow we're investing the money letting it work there is no date of when the reimbursement has to occur so you can literally accumulate expenses for the next ten years all the while your accumulate those expenses you can let the earnings inside of the HSA continue to compound if you don't know about compounding interest go listen to some of our shows to talk about that then you can reimburse yourself a decade in the future an example will be very beneficial right now here let me give you an example this year a family can put in $7000 I just put in $7,000 what do you know just a few weeks ago into my HSA I've already maxed out 2019 and let's say let's fast-forward seven years that $7000 has now turned into $14,000 now in the year 2019 when I funded the $7000 let's just say I had $7,000 worth of health expenses qualified expenses I waited didn't get reimbursement in 2019 we heard I invested it fast forward the seven years it's now worth you know $14,000 I now take my seven thousand dollar reimbursement from the Year 2019 so I took the contribution I took what I put in back out I still have seven thousand dollars in that HSA account think about this if I would have not done that strategy if I would have just gone for reimbursement of the seven thousand dollars of expenses we'd had a zero-sum game yep I put seven thousand dollars in I had seven thousand dollars of medical expenses I pulled seven thousand dollars out we ended up the year into the Year 2019 we ended up at zero mm-hmm if we do it my way we put the seven thousand dollars in yes I'm essentially lending that money to myself I invested it it grew to fourteen thousand pulled my seven thousand out simple math is there still seven thousand out there of house money working force that will be available for more reimbursement or just to grow and you heard Bo say there's even a point in time that I might be able to use this for non-medical expenses that's right in retirement so I your example is beautiful I like to challenge your math just for one second they don't know no no you said everything perfectly but I'm gonna throw one extra thing out there just to swing a little bit even in the scenario where you said I put seven thousand dollars in and I'll pull the seven thousand dollars out it's a zero-sum game right right that was the thing you laid out no cuz I took a tax break so you've got attack no matter even if you're somebody out there correct it makes ten million dollars a year you get a front page tax deduction for your HSA contributions so even if you put the money in and then you pull the money out you still get a tax deduction it is really hard to find a reason or a person who is eligible for HSA that it makes sense to not make HSA contributions well now look we have to be careful because there are a lot of you guys that work for great corporations fair enough yeah and and they give you some Cadillac insurance I mean these people love having you as an employee so much so that you almost have to take the Cadillac health districts because we have we have some we've seen those plans yes so I want to cut I love HSAs but I had access to some of your health care options especially with a special needs child we'd probably nothing on the HSA but that's the exception to the rule you have to have really good health insurance with your employer one of the questions we had on here and I thought this was just a great question worth mentioning it says is there is there low-cost HSA provider when I left my employer the HSA was charging a monthly fee of like $3 so what I'd be able to roll over an HSA to a lower-cost plan a lot of times when you work with an employer it's a love the one you're with type thing especially if your employers putting money into the plan they might tell you that you have to use provider ABC if all you want to get the free money but one thing that you can do is when you leave that employer or maybe even while you're with that an employer if you're allowed to have two plans there are some really great low-cost providers out there if you want to know more about that go to our website money guy comm type in health savings account we're doing a whole show on there we walk through there are a couple of them health savings administrators well I'll just say because I it's I haven't done an update on all the providers recently and we don't like to do recommendations on the show instead of getting it because I'm not giving a recommendation I just two things I've noticed I'll tell you I've used this is not a wreck because I have it's not I don't get anything from this I'm just sharing what I have I use the HSA authority yep but I will tell you and but we don't have details on it right we have connections with fidelity and they've shared with us that fidelity plans on getting in this HSA game pretty heavy you don't know the details yet but I'm curious HSA is kind of when when when fidelity Vanguard or Schwab do something kind of I get excited I'd usually it's it's cost-effective really good portal tools a lot of an easy access I get excited when the big players are taking this stuff serious is that right all right option number three may not weird this was following when we douche pod cat our money guy shows we have long shows we have what's titled short shows this well this short show is going to be longer than most long shows keep going we have long shows and not quite as long shows all right so we talked about the able accounts talking about how savings accounts this next one is a really really interesting one a dependent care flexible spending account we were going to take some time and talk about flexible spending accounts but think most people know what a flexible spending account is it's not quite as exciting as a health savings account so we didn't think it deserved out in that amount of real estate but dependent care FSA's are a unique animal well the big thing typical FSA flexible spending account is for reimbursement of you a lot of your medical expenses up to like four twenty seven hundred dollars a year and say use-it-or-lose-it type situation the problem is they don't play in the sandbox a same sandbox well with health savings accounts so a lot of people are like I mean you just talked about how much you love HSAs and now you're gonna flip over to FSA so those twos don't work together you're right but guess what health savings accounts work beautifully with dependent care FSA's because there's a carve-out in the legislation that allows people to still use dependent care FSA's with the health savings these things do piggyback quite nicely well they could be practically related so a lot of you like whoa Kay you got mad my I'm interested what's giving me the scoop what so what's the dependent care HSA have you ever wondered how you go pay for preschool how you gonna pay for summer day camp how you gonna pay for the before or after school school programs yep and let me tell you what if I could help you pay for it with a 30 at least a 30 percent off coupon you would sign up for it all that everybody this is no different than when we do 401k presentations I say everybody signing up for the matching contribution because it's free money right well it's kind of the same thing with dependent care FSA's because when I say when I say it thirty percent off coupon where's that coming from here's where the savings are it is exempt from income taxes so we know that's at least fifteen percent probably yep but you know what else it's a 15 to 20 percent easy it's also exempt from payroll taxes that's the bacon your employer will love this too because Medicare nope Social Security nope none of these things are being charged on money that you're putting in these FSA type accounts and since these are dependent care FSA's you're paying for your after school programs your date all these learning opportunities for your children and it's gonna be income tax as well as payroll tax free for you and your employer so what's your homework if you are someone and your child does go to day care services or summer camp service there are some mechanism or you're having child care throughout the day you ought to at least ask your h HR department hey do we have access to a dependent care FSA because what you can do is you can elect up to five thousand I think as a limit $5,000 you can have five thousand dollars withheld and then you can immediately reimburse yourself from that account on a monthly quarterly however your plan operates to pay those fees it's a fantastic way to make a expense that you're going to have anyways pre-tax and a lot of I think employers and you kind of alluding is all employers are scared of setting up stuff but the savings on the payroll side helps them to me that's why the government did this thing so that's a great opportunity definitely go do some research on dependent care FSA's you know go to money guy comm if you want links or some other resources that we can provide and the fourth one is all right so you know one of the things that we love here at the money got show more than anything else is compounding interest you've heard us talk about this idea of eighty eight times overwrite a 20-year old if you can take a doll or go invest a turn ten percent until you turn 65 you can turn one dollar to eighty eight which is just so exciting but what if you could do something even more what his thing is a tax-free or scrovo gonza hey morph did you just use some sort of Auto to no effects are built directly it God gave me this ability to make these type of special effects and and guess what you're wondering you see this big box behind Bo Y like does that thing do anything except say the money gosh oh you're darn right it does every now and then because we're we're still looking for a money guy employee by the way I don't have you knew that we're hiring right now you are hiring a money guy employee if you are looking for an entry level type position that wants to grow exponentially with the money guy show reach out to us bow and money guy but watch this boom look at that we have a visual this is something that fidelity put together on their custodial Roth are here while this is why you're soaking in this incredible opportunity for exponential compounding interest and the opportunity I mean notice what this is this is showing a fifteen year old if they're just doing the fifty five hundred dollars a year by the time they reach retirement they're going to have access to close to three and a half million dollars tax-free unbelievable so you guys are interesting because now look they're about it the old dude at the bottom you see that poor guy hold on forty five-year-old eyes they just call forty five and I'll do cuz I can do I'm going what I get when you get told stuff after a while you just like you just I guess I guess I guess my my but doesn't look good you know because they keep telling me it doesn't this is this is what happens we keep getting told the same thing over and over again self-fulfilling prophecy that's what happens here in the money guy shot I get keep getting told that being in your 40s is older but people are all listening who are older and forty five they get mad at you but they all seem much younger than you so you're probably I've got you intrigued because you see that forty five-year-old puts fifty five hundred for the rest of their time it only turns into four hundred and twenty two thousand dollars but I don't know if you saw that I've gotten so old I should have bought a bigger dag on TV it is ridiculous I have reached that age and I'm gonna have to get cheaters man we're not we're not there yet so I'm fighting this thing as long as I can but custodial rosters is exactly what their name implies guys this is if you have children minor children that are under majority age meaning under under eighteen that have earned income because that's a key component to all Roth IRAs they government gets us tax-free growth for saving for the future but you have to have earned income so they allow for an adult to be you know to kind of be in charge of these accounts for the beneficiary of that working child you have to file a tax return I have a fifteen-year-old that has one of these custodial Roth IRAs is set up we're having to file a tax return it for her to show that she has earned income for babysitting and other things um so but we're contributing that money into an investment account I'm doing a dollar-for-dollar match for whatever she puts of her babysitting money into her Roth account we make sure it stays within her and income from its I match it dollar for dollar because I want her to be excited about saving for the future and I think about how powerful that could be just for a few reasons bronson think about when your daughter right when she goes off to school and then she gets out and she graduates she gets her first job and she sits in her very first 401k enrollment meeting and under it starts hearing how the 401k works she's gonna think oh wow that thing that happened I was doing that with dad back when I lived at home or if she starts investing and she actually sees that money grow think about how much more inclined she's gonna be to be a saver early on imagine if you can equip your kids with the desire to start saving before they're actually little birdies that are outside of the nest while they're still little birdies inside the nest and they have the single greatest asset they're ever going to have which is an unbelievable amount of time for that compounding interest to work and you better do a good job of educating them on the power of these things because guess what in eighteen or twenty-one years of age they gain control of these assets so make sure you are focusing not only on the exponential growth but how that exponential growth only happens if they let that money continue to work form that army of dollar bills has to have time to really turn into the size and reach its potential and become that exponential working organism that is going to do incredible things for your child so make sure you're focusing on the financial basics and understandings get them excited about the money gosh oh and I think that they will do really good things because it depending upon what state you live in 18 to 21 these things become under their control and their significant Singh difficut awesome market so for it counts you may not know of they can have a huge impact of your financial life the first was the able account which we talked about the second was health savings accounts the third is the dependent care flexible spending account and the fourth is a minor or a custodial Roth IRA account man this show for a short show I feel like we packed a ton of punch in this one this one was filled with TNT so guys I don't know how else you can see how passionate we are about saving for the future letting you be successful for the future and that you're probably like you're you're tuning you know what is this thing this I mean these guys are just basically giving it away this is free information you're exactly right this is what we call the abundance cycle we hear it abound wealth and the money got family we felt like just come here we're gonna love on you giving you tons of free advice we want you to grow we want you to be successful we want you to build that foundation so at one point you're gonna wake up and you're gonna realize holy cow I'm successful I have reached a point where I don't have time to keep up with this or man this thing has gotten complex or I heard those guys talk about a concept I just don't know if I'm maximizing all my opportunities or I just need to get a second opinion or somebody look over my shoulder that's when you can pay us back I want you to consider at that point reaching out to us consider taking the relationship to the next level go to money guy calm or bound wealth calm we have contact us pages on both of those websites and we're gonna be able to hook you up what do I think where you were with the road you know as I could tell your arroz Bhat was it you nailed like brunch you get the flu every week seriously man no no bedridden last week and this week I'm just I'm hopped up and ready to go and just share I mean you can just tell so go check it out money god calm poet this is our youtube counter we want to get this number we're so close to twenty one thousand next time we do a show we'll be well over 21,000 I want that number to be a hundred thousand because you know what goes on one of these walls once we reach a hundred thousand on YouTube we get a cool little play button they're gonna send us and there's little trinkets we get to be my age that's what gives you really excitement your emails also give us purpose keep that stuff coming make sure you subscribe sure you also click the Bell so we get notifications we're doing stuff and then go to money guy calm and give us your email address and zip code so when we drop into your area take this road on the show you know the show on the road we know where the money got family lives I'm your host Brian Preston mr. PO Hanson will be back soon

Channel: The Money Guy Show

Views: 23,350

Keywords: money guy show, debt, budget, cash, real estate, insurance, how to make money, save, credit card, compound interest, buying house, buy stock, success, personal finance, how to build wealth, building wealth, money, how to be a millionaire, how to be rich, how to get rich, investing, how to become a millionaire, how to become rich, wealth building, build wealth, wealth management, 4 Life-Changing Investment Accounts That You May Not Know About!

Id: JSUKiuCdojU

Length: 42min 11sec (2531 seconds)

Published: Fri Apr 19 2019