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Dad’s take on Amanda’s Wedding


wedding_dance.jpgIf there is a uniquely American character trait it might be this….

…our aspirations are focused on having our children routinely and comfortably exceed their parent’s level of attainment and achievement.

We commonly expect them to receive a better education…and to pursue career opportunities that were unheard of in their parent’s prime…and then to enjoy the harvest of a long, and productive life…expanding the dimensions of health and longevity.

Which might help to explain why weddings are such an emotional milestone for the parents.   It’s tangible proof that all the hard work and preparation of both generations is amply rewarded.

Due to many traits, including family history, Amanda has proven to be an excellent manager and steward of her money and her future…as she has amply demonstrated in her four-part exposition.

And truth be told, I might have held my thumb on the scale to steer her in the direction she ultimately took…but the choice was always hers as to how she wanted to plan and organize her big day.

Flash back to ten years ago…

…when she was a teenager working her first W-2 type job, as a checker at the local Kroger Store.  This was the opening for her Mom and I to start funding her Roth IRA, just as we had done the previous year for her older sister.

The law requires earned income to be eligible for a Roth.  But the law does not require that the account be funded by the wage earner.  It can be gifted by the parents (or grandparents), and this turned out to be ultimately the wedding gift that will keep on giving for generations to come.

It’s not easy for our children, working at low paying jobs, to fund a retirement savings account like a Roth.  But we found it to be a relatively painless way to salt away $30,000 for each child, by making the maximum contribution until they were working in career jobs and could shoulder this burden themselves.

The money was there for a big wedding…if that is what she wanted.

But by opting for the more intimate ceremony, Amanda was able to keep the Roth IRA fully intact.

At the current account value, assuming not one more dime of contribution,  and allowing for compounding at 10% over the next forty years…when she becomes eligible for retirement…the account will reach $1.7 million.

To reverse the equation, the present discounted value of a future sum of $1.7 million over forty years at 10%, is a sum just under $40,000.

A sum that many a proud father would pay for his daughter’s wedding.

I’m so proud of my daughter…for taking the road less traveled.

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