Most wealthy families have a plan for what happens when they die, but so few have a real plan for what happens when their kids turn 22. That's the gap I keep seeing, and honestly, it's one of the most expensive mistakes I watch high net worth families make. They’re missing an incredible opportunity to make an impact in some of the most formative years of their kids’ lives.
The Missed Opportunity We Need to Talk About
High net worth families spend real time and energy on estate planning, which usually means trusts, wills, and where applicable, succession structures. All of that matters, but almost all of that planning is built around death, not launch.
There's a window between ages 22 and 30 where the financial decisions your kids make (or don't make) will have an enormous impact on the trajectory of their wealth for the next four decades. During that window, tax brackets are at their lowest, time horizons are at their longest, and the compounding math is working at full force in their favor.
My experience is that the standard approach (even for very successful families) is to let that window close without doing anything too intentional with it, and by the time they realize it, the most powerful years are already behind them.
You may help with a downpayment on a house or extend the runway for grad school–again, all good things–but there is a strategic conversation that might be far more impactful.
$300K in Roth by 30 Years Old
Like many important priorities, setting a measurable goal makes a big difference. For our family, we’ve set a goal of getting each kid to $300,000 in Roth accounts by the time they’re 30. (This is not investment advice.) Why would we do that? Especially at such a big scale?
What's your initial reaction to that number? There's no right or wrong reaction but let me show you the downstream thought process that led us to setting that goal as a family.
The number our family keeps coming back to is $300,000 in a Roth account by age 30. Why is that? Well, let’s just hypothesize for a second that they see an average 8% market return from now until they are 65. (Important disclaimer on markets at the bottom.)
With broad market returns at roughly 8% a year, this means money doubles approximately every nine years.
- 30-39: $300K becomes $600K
- 39-48: $600K becomes $1.2M
- 48-57: $1.2M becomes $2.4M
- 57-66: $2.4M becomes $4.8M
And let me incredibly clear–this hypothetical means no more money is put into the Roth account past 30… Time and compounding really should be the 8th wonder of the world. Even markets underperformed historical averages, and you “only” got 4%. That’s still modeling at just under $1.3M. Would an extra million go a long way? (Again, disclosures at the bottom.)
What makes this feel urgent is that every year you wait, you're potentially shortening the entire compounding cycle, and those cycles don't come back.
Yes, Please Spoil Them With Roth Money
While we’re here, let me address one reaction I commonly get: "Are we spoiling our kids?" It is worth mentioning that Roth Dollars play a special strategic role. Their biggest value is that the highest and best use of this money is not to touch it until they are looking at retirement. That said, they also do provide some hedge on risk for things like entrepreneurial pursuits because you can withdraw the principal tax-free without penalty. We like both of those things.
The Tax Perspective On This
My two kids, CJ is 24 and Bryce is 21, are both active partners in our family businesses, and we've been very deliberate about building this structure with them, not just for them. Here are a few things we're doing that I also work through with clients:
Income-shifting. Because the kids are in lower tax brackets, we route income to them strategically, so they pay taxes at their rate instead of mine, and that money then flows into Roth accounts, where it hopefully compounds tax-free for the next 40-plus years.
Annual gifting as architecture. You can gift up to $19,000 per person per year, and most people think of that as generosity, I think of it as infrastructure. That money doesn't have to sit idle in a savings account; it can fund Roth contributions, cover maximums, or seed long-term investment positions.
The match incentive. For some families, we structure it as a match: you put a dollar into your Roth, we replace that dollar through gifting. It keeps the kids engaged and invested in the outcome, builds the financial habit early, and makes the whole thing feel like a shared project rather than a handout.
There's also a dimension to this that goes beyond math. When your kids are managing smaller amounts of money and making real decisions with real tradeoffs, they're building the judgment they'll need when the numbers get a lot bigger. I’d rather them learn now.
What Most Families Are Waiting For
I understand the instinct to wait until the kids are more "established," or until the estate plan feels more pressing, or until there's a clearer picture of what they'll actually need. Here's the irony that I come back to with almost every family I work with the less money your kid has right now, the more powerful every single dollar is.
You don't need to transfer wealth to start building wealth together. The launch window is actually the best time for the most consequential planning, precisely because the numbers are still manageable and the time horizon is extraordinary. Multi-generational wealth isn't something that gets built at death. It gets built at 22, in the humble years before anyone thinks it matters.
The information provided in this article is for educational and informational purposes only and should not be construed as investment, tax, or legal advice. All investing involves risk, including the potential loss of principal. Past performance is not indicative of future results.
The hypothetical investment scenarios presented in this article are for illustrative purposes only and do not represent the performance of any specific investment product or strategy.
Hypothetical performance results have inherent limitations and do not reflect actual investment results. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown.
The assumed rate of return used in these examples (8%) is hypothetical and is not guaranteed. Actual returns will vary depending on market conditions, the investments selected, and other factors. There is no guarantee that any investment strategy will achieve its objectives.
Roth IRA contributions are subject to income limits and other IRS rules and regulations, which are subject to change. Gifting strategies and income-shifting techniques have legal and tax implications that vary based on individual circumstances. Consult with a qualified tax professional, attorney, or financial advisor before implementing any strategy discussed in this article.
Wayne Wagner Jr., ChFC is a financial professional with Vizionary Wealth Management. This content represents his personal views and opinions and does not constitute a solicitation to buy or sell any security.