Make Your Child a Millionaire

Start Young for a Secure Retirement

What sage advice has been handed down through the ages from parent to child that still holds true today, no matter how culture and technology have evolved? Hard work pays off, and it is good to get into the habit of saving money at an early age.

Turns out there is a way parents can lead the way in helping their children grasp these two ideals while pretty much ensuring their child’s secure retirement.

A Roth IRA for kids is the answer. Often these IRAs are referred to as a custodial IRA as parents or guardians must start the account for the child and maintain custody of it until the child is of legal age.

“If you start an IRA for your teen at say age 13 and put the yearly maximum allowed of $6,000 in the account and use a conservative growth of three percent, which by the way is a lot lower than the average, your child will have at least a cool half million in that account by age 70,” said Chris Carosa, president of Carosa Stanton Asset Management, located in Mendon, New York. “That is as long as you don’t touch it.”

They key is to start as soon as a child is earning his or her own money, Carosa explains. For instance, payment for baby modeling contracts qualify for a custodial Roth IRA, but of course, not all babies get to be models. In most cases, kids begin earning money for chores and tasks as simple as taking out the trash or mowing the lawn. As long documentation backs up how much work the child performed and how the child was paid, the monies qualify for deposit in an IRA account.

The custodial IRA account is an even better opportunity for families that own a small business, said Carosa. Children legitimately completing work for the business have that pay, or a portion of that pay, deposited into an IRA. As Carosa explains, this is an even better bang for the buck: children generally do not earn enough to pay taxes on yearly income; the IRA deposits are tax-free monies set aside for the child’s future; and business deductions for the current tax year and in some cases, either reduction in or no payroll taxes on the child’s income.

Carosa discovered the gem of a child’s IRA when volunteering as a merit badge counselor for the Boy Scouts of America. As a financial services professional, he has the expertise to teach the personal finance merit badge.

He was using an Excel spreadsheet to show Scouts how much money they would have by age 70 if they started investing just a $1,000 a year at age 15. Turns out, he made a mistake on the spreadsheet and actually started the investment at age zero. The result from age zero at $1,000 a year with the three percent growth rate was staggering, he said: A couple of million dollars set aside tax-free for retirement spending.

It got him thinking.

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What if parents did this for their children?

That thought backed up with research interviews with families that helped children sock away earned monies prompted him to write the book, “From Cradle to Retirement,” in which numerous case studies and personal experiences are documented as a guide to help parents, guardian, and even grandparents give the next generation a financial boost.

While on the book tour, Carosa was often asked the question, “My child is a teen, is it too late?”

This led him to work on a sequel, “The Parents Guide to Turning Your Teen Into a Millionaire,” which is due out by end of 2020 in ebook and print format, Carosa said.

That book will join his stable of numerous other books on financial topics ranging from pre-retirees identifying just how much money they need to retire to a look at how a family-owned pizzeria created financial stability for its owner.

Carosa has been the president of Carosa Stanton Asset Management, an independent fiduciary firm since 1996. He continued writing several financial-oriented books and is chief contributing editor of

Between his books and speaking engagements and his asset management firm, Carosa is a busy entrepreneur. But his most pressing professional passion is helping parents help their children. He acknowledges that saving money can be a challenging habit to form. Yet, he believes it pays off.

“Once the parents start and they and their kids see the money begin to accumulate, it often becomes a hobby for them,” he said. “They get interested in watching the account and once they see the amount going up, they come back to me and say ‘wow, this is pretty cool.’”

To learn more about Carosa Stanton Asset Management visit:


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