GRAND Magazine - Spring 2021 - 25

grandparenting
We have found that the best approach to this is not
a loan or a gift but simply to take a small equity position in your grandchild's first home. If, with your help,
they can get an 80% loan, you would make the down
payment and thus become a 20% equity partner in
their starter home. They would make mortgage payments and have the advantage of leverage so that
whatever profit was made when the house was sold
would go 80% to them and 20% to you. This way they
owe you no payments or interest and simply pay off
your equity when they sell. Like any financial agreement within families, this should be carefully documented and signed by you and by them.

be reasonably expected to, over time, " payout more
than you paid in. " -so stocks or a home purchase or
even tuition would qualify, but not a car which would
depreciate rather than appreciate.)
This approach can ultimately make a big financial
difference in a grandchild's life by increasing the total
amounts invested in the early years of compounding
so it can grow for a much longer period.

Summary

Setting up a family foundation
and doing " expeditions "

Setting up a Family Foundation, even if there is not
a great deal of money in it, can be a powerful way
to get children involved in looking for and meeting
needs, particularly in poor communities or developing countries. As grandkids get involved it can help
teach the principle of " Where much is given, much is
expected. "
Many non-profit humanitarian organizations organize family " expeditions " where family members can
travel to remote locations and help to build schools
or clinics and have a hands-on experience of helping those in need. In our own family, these expeditions, funded in part by our family foundation, have
opened our children's eyes to third-world needs and
helped them feel empowered to do a little to help.
One byproduct, of course, is greater appreciation and
gratitude (and responsibility) for what they have.
25 GRAND

Spring 2021

Matching contributions in custodial
Roth IRAs

With a parent as custodian, a child of any age can
have a Roth IRA where money grows tax-free toward
retirement. (A grandchild 18 or older can open his or
her own Roth.) And with a Roth, funds that have been
put in can be taken out as desired without penalty.
Consider offering a " savings match " to any grandchild who wants to put some of their " earned money "
into a Roth. They can put in up to half of any earnings
they can justify with a W-2 or an earnings record of
some kind-up to 6,000 per year. Strike a deal where
anything they put in up to 3,000 will be matched
by you, dollar for dollar. Create your own rules and
agreement, perhaps requiring that the money be
used only for investment (defined as things that can

Most of us grandparents do not have vast resources
with which we can assist our grandchildren at every
turn or with every need. And we would probably be
unwise to do so even if we could. But whether we
have a lot or a little, it is important to be deliberate
and clear in our own minds about what our goals are
and how we can help our grandkids materially and
financially in ways that avoid entitlement and that are
wise enough to increase rather than diminish their
independence and sense of self-reliance-and that do
not step on parents' toes in the process.

Richard and Linda Eyre's parenting and lifebalance books have reached millions and
been translated into a dozen languages. As
fellow Baby Boomers, their
passion and their writing focus
has now shifted to the joy of
Grandparenting. Linda's latest
book is Grandmothering,
Richard's is Being a
Proactive grandfather, and
their latest co-authored
book is Life in Full. All
three of these are now on
sale on Amazon.

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GRAND Magazine - Spring 2021

Table of Contents for the Digital Edition of GRAND Magazine - Spring 2021