As a parent or grandparent, you want your children or grandchildren to have a head start when it comes to their finances. When it comes to your kids saving money, what are some ways that you can help them while helping yourself as well?
Contribute To A 529 Plan
Saving money for college is difficult. However, it can be easier when you put money into a college fund for the younger generations in your family. The best part is that you can also defer paying income tax on all funds put into the program. As long as the child doesn’t use the money until the age of 18, you may never have to pay taxes on that money.
Invest In Their Business Ventures
If you have a self-directed IRA, you can invest in anything that you want. This means that you can put money in your retirement account and then invest that money in their businesses. You are going to help your children or grandchildren fund their ideas while helping yourself save for retirement.
Donate Your Old Clothes, Toys Or Other Items To Use As A Tax-Write Off
You can donate old clothes or toys to your children and claim it as a write-off on your tax return. This helps you gain more space in your home, help your kids raise their kids and also help you reduce your taxable income. In most cases, you can only write-off the current market value of the objects you donate.
Claim Your Grandchildren As Dependents
If you have grandchildren who live with you on a regular basis, you may be able to claim them as dependents. Therefore, you can give your grandchildren a good home while saving thousands on your taxes each year. Make sure that you check with an accountant before making this claim to ensure that you are following the rules.
As a grandparent, you can help your kids and grandchildren while also saving money yourself. Therefore, look into the options available to you to see how you can benefit from your kind decision to help the younger generations in your family.