My son is 4.5 months old. His grandparents just called and asked for my his social security number. I of course asked what they needed it for and they informed me that they set up a savings fund for him and they add to it each payday. No one can tap into the fund except my son (at age 18) and his grandma. They said they estimate it will be at least $50,000 or more! by the time he is 18. I'm thinking, 18? why not 25? They are hoping he will use it for college but I imagine he'll be car shopping on his 18th birthday and regretting wasting the money by the time he's 25-30. Should I suggest age 25? or let it be?
2007-10-25 04:10:19 · 14 answers · asked by ? 6 in Business & Finance ➔ Personal Finance
This is my in-laws not my parents.
2007-10-25 04:11:50 · update #1
My parent's did the same thing for their 3 grandchildren (my 2 neices and 1 nephew). The expectation is that the money is for college. The girls are now 9 and 12- they know about the accounts, since contributions are made 3 times a year - Easter-Birthday-Christmas. They know these are their college accounts- end of story. Not maybe college, maybe car, maybe European vacation accounts- College. You do the same thing- if your son knows from a young age the $ is for college, he'll have no expectation of anything else and will never even consider wasting it.
2007-10-25 04:34:49 · answer #1 · answered by GEEGEE 7 · 1⤊ 0⤋
As a person who's grandparents had set up an account like this for me, suggest they hinge it on situations, A) for college use only or B) unable to collect until age of 27. 25 is still too young for such a gift (I blew through it so fast it scared my parents) Also suggest it be set up as a trust so the determining factors can be evaluated by a neutral party.
2007-10-25 04:21:42 · answer #2 · answered by Richard T 3 · 1⤊ 0⤋
Suggest that the trust fund has stipulations. Terms under which money can be withdrawn. Or, suggest to your in-laws to invest in a 529 college savings plan controlled by someone other than your son. That way if used for school there are tax benefits.
2007-10-25 09:43:56 · answer #3 · answered by cradduck205 2 · 0⤊ 0⤋
I agree with the age 25 or 30 even to give him a few years to learn responsibility by getting a job and earning his first car as well as renting a place to live just to see how important it is when it comes to making appropriate financial decisions.
Also, I think the idea of a kid with access to that kind of money would be disasterous IMO.
2007-10-25 04:18:14 · answer #4 · answered by Anonymous · 1⤊ 0⤋
It is ur responsability to teach him and make him aware of his finances and yes talking to ur inlaws would be good maybe when u explain to them that at 18 he might not use the money wisely they will understand. One other option is at 18 yrs old get ur son into a money management class it is a 12 month class it really helps my cousin was left a huge amount of money and his mother requested that before getting the money he had to complete the 12 month money management class and he learned alot and has invested some of that money and has doubled it...good luck u will figure it out..
2007-10-25 04:23:56 · answer #5 · answered by sugar_britches1975 2 · 1⤊ 0⤋
Absolutely!! at 18, kids are looking to just blow money. Or at least most of them are. Let him work hard for his money and when he's ready for college or gets a little older and more responsible, then let him have the money.
I would also keep this a BIG secret from your son. This way, he doesn't think that he's going to have this huge lump sum of money to look forward to blowing. It'll be the greatest surprise of his life.
Just mention to your in-laws that you think it would be an even greater idea to give this money to him when he's even older, that way he's more responsible with it.. What can it hurt to voice your opinion? After all, he is your son!
2007-10-25 04:18:02 · answer #6 · answered by sunshine2211 2 · 1⤊ 0⤋
Have them set it up how you want it 18 for school only and 25 if he doesnt go tell them you dont want him rewarded for not going to collage and thats why you would feel better about 25 and remind her that it will grow and be worth more at 25 as thats 8 more yrs interest! and some girl wont help him spend because he will be older and more muture at 25
2007-10-25 04:15:31 · answer #7 · answered by Linda S 6 · 1⤊ 0⤋
Maybe suggest that they set it up that he can draw $10,000 a year for 5 years at age 18. You as the parent just need to make sure that he knows what the money is for and make sure he is responsible enough to use it.
2007-10-25 04:16:26 · answer #8 · answered by jhorn1978 2 · 1⤊ 0⤋
It is their choice. No matter what they decide, you still need to teach your son how to handle money. That just because he has a dollar, doesn't mean he has to spend it and then hope he doesn't blow that money on a car right away.
Can you ask them to put it in there that he can only use that money for college & related expenses (dorm, books, etc.).
2007-10-25 04:15:26 · answer #9 · answered by Jo 6 · 1⤊ 0⤋
if we keep going the we are going now (fashion) he will be saving for a penis/peck/mussel enlargement so yes try and get them to change it to only educational uses only from 18 to 25 then after 25 have it for what ever he wants
2007-10-25 04:16:27 · answer #10 · answered by Dane'o 3 · 1⤊ 0⤋