Beck Bode
70% of families who build wealth lose it by the next generation. Not because they didn't earn enough or invest well, but because the next generation was never taught how to think about money in the first place.
Co-Managing Partner Jim Bode and Director of Client Advisory Vincent Savio sat down to talk about what the families who beat that statistic are doing differently. What came out wasn't a lecture on retirement accounts or tax strategy. It was a conversation about habits, about starting before it feels like the right time, and about a few small decisions that compound into something extraordinary.
What's the simplest thing I can do to set my kids up financially?
Start before they're ready. That's what Jim Bode did.
About ten years ago, he and his wife Crista opened small investment accounts for each of their three kids, now 19, 16, and 12. Not custodial IRAs. Not 529 plans. Just simple accounts in their own names, funded with a couple hundred dollars each, so the kids could see what it looks like when you own a piece of a company.
"They don't necessarily need to understand what's causing the markets to go up and down," Jim Bode says. "But I wanted them to get the idea of, hey, if I open up an app on my phone and I see that I own these three or four companies, I'm gonna start understanding what's happening with money."
He and Crista called it the "investment tax." Whenever the kids got money, a small portion went into their account. Mom and dad matched a little. The kids got to pick which companies they wanted to own. And slowly, the habit of saving became part of how the family talked about money.
It wasn't financial planning. It was something simpler and more powerful: a conversation that started before the kids were old enough to understand compound interest, and now shapes how they think about every dollar.
If you're waiting for the "right time" to start that conversation with your kids, the point is clear: the right time was before they were ready.
Jim Bode has written about how this same approach shaped his family's college planning process and the $50,000 mistake he almost made along the way.
What is a custodial Roth IRA, and why should I care?
This is the account most families don't know exists.
Vincent Savio shared the story of a client family with two working teenagers, one in college and one about to graduate high school. The question came up: what should these kids be doing with the money they're earning?
The answer was a Roth IRA. For those unfamiliar, the key difference between a traditional IRA and a Roth is simple: with a traditional IRA, your money grows tax-deferred and you pay taxes when you take it out. With a Roth, you pay taxes today, your money grows tax-free, and when you take it out after age 59 and a half, all of it is yours.
For a teenager earning part-time income, the Roth is powerful because they're likely in the lowest tax bracket they'll ever be in. Pay a small amount of tax now, and decades of growth come out completely tax-free.
The family started each kid with $500 and a goal of saving $200 a month. Vincent Savio ran the projections: at an 8% average annual return over 45 years, that's north of $900,000. At 10%, roughly $1.7 million. From a total contribution of just $108,500. (These are hypothetical illustrations only and do not account for taxes, fees, or inflation. Past performance does not guarantee future results.)
If your child has earned income from a job, babysitting, lawn mowing, or anything else, they may be eligible to contribute to a Roth IRA. For minors, a parent signs as custodian on the account until the child reaches the age of majority. The 2026 contribution limit is $7,500 or 100% of earned income, whichever is less.
"Wouldn't you rather know about this now than find out 30 years from now what could have been?"
— Vincent Savio, Director of Client Advisory
When does saving actually start to feel real?
When you see your money make money for the first time.
Jim Bode told the story of his oldest son opening a Roth IRA. The first year, his account was up about 10%. He looked at it and said, "Dad, I made $600. That doesn't feel like that much."
Then the second year happened. Another contribution, another good year, and suddenly that $600 turned into $1,200. The account was growing faster than what he was putting in. In front of his eyes, he saw compounding click.
"It changed his view," he says. "From 'do I want to go hang out with my buddies after class' to 'I need to get more money into this account because now my money's working for me.'"
This is the Rule of 72 in action: divide 72 by your annual return, and that's roughly how many years it takes your money to double. At 10%, your investment doubles every 7.2 years. Start at 18 instead of 30, and you get two extra doublings over your lifetime. That's not a marginal difference. That's a generational one.
The average American doesn't start saving for retirement until age 27 to 33. The families in this conversation gave their kids a 10 to 15 year head start. That gap is the difference between building wealth and inheriting the same financial stress your parents had.
Is a 529 plan the right way to save for my kids?
Maybe, but probably not as your primary vehicle.
Jim Bode addressed this directly. A 529 plan offers tax-free growth as long as the money is used for qualified education expenses. On the surface, that sounds great. But his concern is flexibility.
"When I think of a 529 plan, you're putting rules on your money," he says. "What if your kid wants a gap year? Or what if they get a scholarship?"
For the money that family members specifically wanted earmarked for college, he and Crista did set up a small 529. But for their own savings, they used a regular taxable account that left them the most flexibility to use the money however they needed.
His broader point: save for yourself first. He's seen too many clients enter retirement proud that they paid for their children's education, but not as financially secure as they could have been because of it. That's not a tradeoff you have to accept if you plan early enough.
The bottom line: a 529 may have a place in your plan, but it shouldn't be the only vehicle you're using. The more flexibility you build in, the more options you have when life changes, and it always does.
At Beck Bode, every client relationship starts with a Goals Planning Statement (GPS), a documented, mutual plan that coordinates savings, investments, tax strategy, and legacy planning into one accountable framework.
Is it too late to open a Roth IRA for last year?
No. If your child (or you) had earned income in 2025, you can still make a contribution for last year. The deadline is April 15, 2026. And you can also make a 2026 contribution at the same time, up to $7,500 for each year. Our team is here to help you open these accounts and it often only takes 1-2 days.
This is one of the most actionable takeaways from the entire conversation: if your teenager worked last year and you haven't opened a Roth yet, you still have time. But not much.
My child just started their first job. What should they do?
Start with a conversation.
Vincent Savio's outlook: look at what the employer is offering. Is there a 401(k)? Is there a match? Is there a Roth option inside the 401(k)? Start by contributing enough to capture any employer match, because that's free money.
After that, there may be an opportunity to open a Roth IRA or another account outside the 401(k) that offers better investment options tailored to their individual situation.
The key point: it's not a quick yes-or-no answer. The right savings strategy depends on the individual, their income, their goals, and what vehicles are available to them. But the most important step is having the conversation in the first place, especially if your child is nervous about it or doesn't know where to start.
That's exactly the kind of conversation Beck Bode is set up to have. Not just with you, but with your kids and grandkids directly.
Why this conversation matters now
Jim Bode reflected on a Vanguard-cited study that found 70% of wealthy families lose their wealth by the second generation. His response:
"If I was to fast forward 40 years from now, when we ran this same study just on our clients, my goal would be to say that 100% of our clients' wealth passed on past that second generation."
That's not just an aspiration. It's a planning philosophy. And it starts with including the next generation in the conversation, not after they inherit the money, but while there's still time to teach them what to do with it.
"My parents' generation, money was a secret. Nobody wanted anybody to know how much money they were saving. We're trying to break that."
— Jim Bode, Co-Managing Partner
If you've been putting off the conversation with your kids or grandkids about saving, investing, or building healthy money habits, this is the push to start. It doesn't have to be complicated. It doesn't require a lot of money. It just requires starting.
Coming up next
The Gap Between Your Tax Return and Your Financial Plan With Ben Beck, CFP® and Garrett Murphy | Thursday, April 23, 2026 at 12pm ET
Common tax mistakes, Roth opportunities, planning gaps, and what can look different when your tax and investment strategies are in the same room.
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If your kids have earned income and you haven't opened a Roth yet, that's a conversation worth having this week. Start the conversation →
Frequently Asked Questions
What is a custodial Roth IRA?
A custodial Roth IRA is a Roth IRA opened for a minor child. The child must have earned income (from a job, babysitting, freelance work, etc.) to be eligible. A parent or guardian signs as the custodian on the account until the child reaches the age of majority. Contributions are made with after-tax dollars, and all growth and withdrawals after age 59 and a half are tax-free. For 2026, the contribution limit is $7,500 or 100% of earned income, whichever is less.
How much should I save each month for my child's future?
There's no single right answer, but this webinar illustrates what even a modest amount can do. Starting with $500 and saving $200 per month in a Roth IRA, with an average annual return of 8% to 10% over 45 years, could grow to $900,000 to $1.7 million. The total contributed over that period would be $108,500. The key takeaway: consistency matters more than the dollar amount, and starting early matters most.
What is the Rule of 72?
The Rule of 72 is a simple formula used to estimate how long it takes for an investment to double. Divide 72 by your expected annual return. At 8%, your money doubles roughly every 9 years. At 10%, every 7.2 years. At 12%, every 6 years. This is why starting to invest in your teens or early twenties creates such a significant advantage: you get more doublings over your lifetime. (Source: Investor.gov, U.S. Securities and Exchange Commission)
What is the difference between a traditional IRA and a Roth IRA?
A traditional IRA offers tax-deferred growth. You may get a tax deduction on your contributions today, but you'll pay income taxes when you withdraw the money in retirement. A Roth IRA works the opposite way: you pay taxes on contributions now, but all growth and qualified withdrawals after age 59 and a half are completely tax-free. For young people in low tax brackets, the Roth is often the more advantageous option because decades of tax-free growth can significantly outweigh the upfront tax cost.
Is a 529 plan or a Roth IRA better for college savings?
Both have a place in a financial plan, but they serve different purposes. A 529 plan offers tax-free growth specifically for qualified education expenses, but it limits your flexibility: the money must be used for education, and your investment options are restricted. A Roth IRA offers more flexibility because contributions can be withdrawn at any time without penalty, and the account isn't limited to education expenses. Many families use a combination of both, but the right answer depends on your individual goals and financial situation.
When is the deadline to make a Roth IRA contribution for last year?
For the 2025 tax year, the deadline to make a Roth IRA contribution is April 15, 2026. You can contribute up to $7,500 (or 100% of earned income, whichever is less) for 2025 and an additional $7,500 for 2026. If your child had earned income last year and you haven't opened an account yet, the Beck Bode team can set one up in one to two business days.
How do I start a conversation with my kids about money?
You don't need a formal sit-down or a financial planning session. Jim Bode's approach was to open small investment accounts for his kids and let them pick which companies they wanted to own. The "investment tax," where the kids save a little and mom and dad match a little, created a habit without making it feel like a lecture. The goal isn't to teach your kids everything about investing. It's to make saving feel normal and give them a reason to pay attention to how money grows.
At what age should I start saving for retirement?
The average American starts saving for retirement between ages 27 and 33, according to the Northwestern Mutual 2024 Planning & Progress Study. But the families highlighted in this webinar started their children saving in their mid-to-late teens, giving them a 10 to 15 year head start. There's no minimum age to start building awareness around saving and investing, and for kids with earned income, a Roth IRA can be opened at any age.
Should I save for my kids' college or my own retirement first?
Save for yourself first. Jim Bode addresses this directly: he's seen too many clients enter retirement proud that they paid for their children's education, but less financially secure than they could have been because of it. Whether they refinanced a home or paused their own savings during the college years, the long-term cost was significant. That doesn't mean you ignore college planning. It means your own retirement savings should be the priority, and college funding should be built around that, not at the expense of it. A Roth IRA can actually serve both purposes: contributions grow tax-free for retirement, but they can also be withdrawn penalty-free for qualified education expenses if needed.
What happens if you invest $200 a month for 45 years?
Starting with $500 and contributing $200 per month over 45 years, your total out-of-pocket contribution would be $108,500. With monthly compounding at an average annual return of 8%, that grows to approximately $1,073,000. At 10%, approximately $2,141,000. The numbers are driven almost entirely by compound growth, not by how much you put in. This is the scenario Vincent Savio walks through in the webinar, and it illustrates why starting early, even with modest amounts, creates outcomes that feel disproportionate to the effort.
(These are hypothetical illustrations only. They do not account for taxes, fees, inflation, or changes in contribution amounts. Actual results will vary. Past performance does not guarantee future results.)