My wife and I have decided that for each of our kids, we're going to put aside a small amount of money each paycheck ($50), and give it to them as a gift either when they turn 18 or when they graduate high school. We haven't decided which of the two for certain. We want to keep it as a secret, so they aren't banking on it or counting down the days until that point. Even at 0 interest earned, it'll be almost $11,000 by the time they turn 18, but I'd like to find something relatively safe that provides even a modest ROI. Bonus points if I can automate the deposits, even if they're small increments like $50 every two weeks. While I recognize the tax benefits of a 529, we would prefer not to do that, because we want them to be able to use the money for anything they like.
I'm not completely risk averse, so please no bonds. The 1.3% rate on a 10 year bond is appalling. If it's just, "buy S&P index fund and ride it out for 18 years," that's fine too. I'd love to hear what you all suggest.
Edit: Right now we have one child, who's 11 months old and we've been saving accordingly so far. We are planning for a second child within the next year or so.
Submitted August 25, 2021 at 08:48AM by lyone2 https://ift.tt/2URqSJa
