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Asset Preservation Advisors


State: GA

APA’s philosophy is to work closely with our clients to develop an in-depth understanding of their unique needs and objectives. We then customize a municipal bond portfolio that best meets their specific goals and needs. APA manages high quality municipal bond portfolios in four strategies: Short-Term, Intermediate-Term, High Income, and Taxable.

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What Should I Give for a 21st Birthday?

What’s one of the worst 21st birthday present to receive, but perhaps the best to have? How about the gift of a secure retirement?

| BY Adriana Reyneri

Is a special someone in your life – perhaps a child or grandchild – turning 21? Are you searching for a meaningful gift with enduring value? What about a gift that could actually grow in value and help your loved one enjoy financial security in retirement?

You might consider helping your young adult open an IRA and, as a 21st birthday gift, providing funding for the account. Even small contributions an IRA can grow to sizable sums by the time a young adult reaches his or her retirement years. An initial investment of $500, and annual contributions of just $100, would grow to $14,811 over 44 years, assuming a 4 percent yield. At the end of that interval your 21-year-old would be planning a 65th birthday celebration!

The biggest regret of older investors is not saving enough for retirement.

The IRS will allow your birthday boy or girl to contribute earned income up to $5000 a year, and any young adult who made money within a tax year is eligible to participate. Why an IRA? The retirement savings accounts can be opened with a low minimum balance, provide a convenient vehicle to structure retirement savings and offer many tax advantages. Funds held in IRAs grow tax-free. Those held in Roth IRAs, funded with after-tax income, can be withdrawn tax free, and IRA contributions can be tax deductible.

Did your soon to be 21-year-old work a minimum wage job earning a few hundred or thousand dollars in 2012? Discount broker TD Ameritrade provides IRAs with no minimum initial deposit requirement and no maintenance fees. What says “21” more than a brokerage account with trading apps? More conservative young adults may prefer the FDIC-insured IRAs offered by the Ally Bank. The Internet bank provides IRAs investing in CDS for no minimum deposit or maintenance fees. Check with your financial advisor for other low-cost IRAs offered by financial service providers.

The primary advice Millionaires would give a young investor is to start taking full advantage of retirement savings accounts.

Still not sure? Think back to your 10th birthday. Did a well-meaning aunt or uncle give you a savings bond? Were you less than thrilled at the time? Do you appreciate the gift now?