Estate Planning-how to set up a fund for a child that pays monthly benefits
Hi Terry. I am considering setting aside an amount of money that funds the livlihood of one of my children. He has gotten a late start on building a financial future, and I am concerned that when I am no longer alive, he will find daily living difficult. I am currently 73 years old and in gnerally good health. But one never knows what the future will bring.
Should I use a trust with a funded account that kicks in when I am no longer able to function? What other options moght I consider. Many thanks!
Terry Says
Well, you’re not working so you can’t open an Individual Retirement Account. But if your son IS working, then you could set up an incentive match. Open a Roth IRA at Fidelity or Vanguard. He could put in up to $7500 if he earns that much. BUT you could help him. Just tell him that by December 1 every year, you will look at how much he has contributed and make a matching contribution. So if he puts in $3000, you could put in an additional $3,000. That goes beyond giving him a gift; it teaches him the value of saving/investing over the long run.
