Important Retirement Saving Tips to Teach Your Children

The retirement saving tips for children in this article are aimed to help you teach your child how important it is to be financially secure in their golden years. As with any lesson, this may take some time. But your efforts will provide a solid foundation for your children with earned income by teaching them how to save today to reach their goals in retirement.

Why Are Retirement Saving Tips Important for Children?

Because, having enough money for retirement is critical.

That statement is an absolute truth, yet somewhat mundane and largely underrated for many. Kind of like the words “I love you.” Anyone can say it and mean it. But, the proof lies in the actions that show love and, in turn, make those words meaningful and believable. Saying I love you is not enough. Showing someone you love them by continually cultivating the feelings behind the words, whether you’re dealing with your children, friends, or a spouse, is the foundation of successful relationships built on solid and lasting ground.

And so it goes for retirement planning. It is not enough to simply use “saving for An young adult, Asian brother and sister at a table high-fiving each other because their mother is standing in front of a white board teaching them retirement saving tips. retirement is important” as just a mantra that you tell yourself and your children. Funds are not going to magically appear in any bank account or IRA on their own. You have to be prepared to act—consistently. But, first you have to learn how and acquire the discipline to act beyond mere intentions. You have to teach your children retirement saving tips early and help them develop the habit of saving.

This is what we must teach our children. Today. However, take note: the lesson is not saving for retirement is important, but rather how to begin saving for retirement. And don’t just talk about the different retirement and investment accounts available. Show them how every dime they sock away into an IRA or other investment can mean the difference between financially happily ever after and the dismal alternative. Treat this as a critical life lesson—just as you would the importance of maintaining good health, making good grades, and teaching your children to be courteous, kind, compassionate, successful individuals.

With that being said, there are a few different ways your children can learn today how to become financially secure by the time they retire.

Retirement Saving Tips for Children

1. Anyone with earned income can have an IRA.

Yes, that means if your three year-old daughter is being paid as a model she can establish and contribute to her own retirement account. Once your daughter becomes old enough to make her own decisions, she can use a self-directed IRA to acquire alternative investments that can potentially provide greater retirement income than the average stock, bond or mutual fund.

2. If young adults begin investing in their teens, by retirement age, they could be millionaires.

This is true, provided the investments were successful. But saving early maximizes compound interest on funds in a retirement plan. In fact, Dave Ramsey published an article a few years back that includes a graph that perfectly illustrates how compound interest can accrue into the millions from the time your kids are teens until they become old enough to retire. Read that article here. Print it out and explain it to your children. Invest enough of your own time and interest in them on the subject to encourage them to invest in their own financial futures.

3. Financial freedom does not have to be just a dream.

Financial freedom becomes a reality for those who have a plan, recover from failures, and continue to pursue and reach their goals. Successfully retiring and achieving the quality of life you wish to lead during your later years is absolutely attainable if one understands and commits to the process that will get you there.

This is what your children need to know, to understand, and to commit to early on.

Additional reading on retirement saving tips:

10 FAQs about a Self-Directed IRA (SDIRA) + Alternative Investments

Roth IRAs vs. Traditional IRAs: A Comparison of the Benefits and the Differences

Self-Directed IRAs vs. Traditional IRAs: Which Plan Is Best for You?

If you have questions about this article or wish to learn more about self-directed IRAs, please contact Advanta IRA.

About Advanta IRA

Advanta IRA is a self-directed IRA services provider serving clients of all ages across the nation. We specialize in the administration of self-directed retirement plans that allow individuals to use alternative assets like real estate, private lending, private equity, and more, to build wealth for retirement. We offer free webinars and podcasts, and publish weekly investing blogs designed to enlighten readers and empower investors on the powerful strategy of investing in alternative assets to the stock market.

About Scott Maurer

Scott Maurer, Vice President of Sales for Advanta IRA, is a recognized expert in the field of self-directed IRAs. With a law degree from the University of Florida and as a designated Certified IRA Services Professional (CISP), Scott’s keen understanding of rules and regulations fuels his passion to educate others on the power of investing in alternative assets using self-directed IRAs. Scott is a frequent guest on retirement and investing webinars and podcasts, and he has shown thousands of individuals how to achieve financial freedom by teaching them how to use their retirement funds to invest in private placements, real estate, private lending, and more. Throughout his two decades in the industry, he has watched numerous unique investments unfold, giving him great perspective of what is possible when people take control of their retirement funds and investing decisions.