Are you the owner of a medical practice and have children who are teenagers? Well, you might be their first employer. As a parent, I am hesitant to have my kids work since school and athletics are so time consuming. I also want to set them up for the future and instill a solid work ethic in them while young. The happy medium I found was to employ my son in my business as my technical consultant. This isn’t a fake job used to avoid taxes, as he is significantly more technically savvy than me having built a computer from parts bought online and cobbled together. He researches the technology I need in my business and purchases/maintains my systems, including recently added RAM to my assistant’s computer. I compensated him for his time, and this allowed him to make a ROTH contribution. Other employment options could be marketing, posting to social media, or general office work.
Since a teenager has little interest in saving for retirement, parents can gift or match the child’s contribution. It is also a great opportunity to teach kids about investing and compound interest. The successful professionals I work with are unlikely to have children lacking any creature comforts. It is critical to avoid entitled children who don’t know the true value of a hard-earned dollar. We incorporate this education into our planning relationships and act as a third-party expert. Kids seem to respond much better to this compared to parents’ financial lectures.