Generational Wealth Planner

Design a wealth transfer strategy that gives the next generation a compounding head start.

Core Philosophy

Generational wealth isn't just about leaving money behind. It's about giving your children the most powerful asset: time in the market. A $500/year Roth IRA started at age 16 becomes $1.2M by age 65 — tax-free. The math is magical because of the 50-year runway.

Required Input

• Number and ages of children
• Current savings for children (529, custodial, etc.)
• Children's earned income (if any — enables Roth IRA)
• Education goals and cost estimates
• User's estate size estimate (for estate tax relevance)
• User's state (for 529 tax deduction)
• Any existing trusts or estate plans

Planning Framework

Step 1: The Roth IRA Opportunity (Priority #1 for working children)

Read references/generational-vehicles.md for account rules.

If any child has earned income (babysitting, lawn mowing, part-time job), a custodial Roth IRA is the single most powerful generational wealth tool. Show the compound projection:

Custodial Roth IRA Projection
Child's age: [X] | Contribution: $[X]/year until 22
─────────────────────────────────────
At age 30:  $XX,XXX
At age 40:  $XXX,XXX
At age 50:  $XXX,XXX
At age 60:  $X,XXX,XXX
At age 65:  $X,XXX,XXX (ALL TAX-FREE)
Total invested: $XX,XXX | Total value: $X,XXX,XXX
Return on invested capital: XX,XXX%

Step 2: 529 Plan Optimization

Analyze education funding needs:

• Estimate college costs (current ~$25K/yr public, $60K/yr private, growing at ~5%/yr)
• Calculate 529 contribution needed for target
• Identify state tax deduction (some states give 5-10% deduction)
• New 2024 rule: unused 529 can roll to Roth IRA (up to $35K lifetime, 15yr minimum age)

Strategy options:

1. Full-fund approach: Front-load 529 to maximize compounding
2. Match approach: Match child's savings/earnings
3. Superfund: Contribute 5 years of gift exclusion at once ($90K per parent in 2025)
4. Partial-fund: Cover 50-75%, child covers rest (builds ownership mentality)

Step 3: UGMA/UTMA Custodial Accounts

When to use vs. not:

• Use when: child has no earned income, want flexibility beyond education
• Avoid when: large balances (becomes child's asset at 18/21, affects financial aid, "kiddie tax")
• Tax advantage: first $1,300 of investment income tax-free, next $1,300 at child's rate
• Risk: child gets full control at majority age — no strings attached

Step 4: Trust Strategies (for estates >$1M)

Overview of options (not legal advice — suggest estate attorney):

• Revocable Living Trust: Avoids probate, no tax benefit
• Irrevocable Trust: Removes assets from estate, potential tax benefit
• Crummey Trust: Annual exclusion gifts to trust
• Dynasty Trust: Multi-generational, state-dependent

Flag: if total estate approaches $13.61M (2024 exemption), estate planning becomes critical.

Step 5: Teaching Plan

Wealth transfer without financial literacy is a liability. Include age-appropriate milestones:

• Ages 5-10: Allowance with save/spend/give jars
• Ages 11-14: Custodial brokerage account, pick first stock together
• Ages 15-17: First job → custodial Roth IRA, budgeting basics
• Ages 18-22: Credit building, compound interest deep dive, first tax return
• Ages 22+: Roth conversion of custodial to personal, full investment thesis

Output Format

GENERATIONAL WEALTH PLAN
═══════════════════════════
[For each child:]

[Child Name], Age [X]
────────────────────
ACCOUNTS:
  Roth IRA:     $XXX → projected $X.XM by age 65 (tax-free)
  529 Plan:     $XXX → covers XX% of estimated college costs
  UGMA/UTMA:    $XXX → available at age 18/21

ACTIONS NOW:
  1. [Specific action with dollar amounts]
  2. [Specific action]

MILESTONES:
  Age XX: [Event/action]
  Age XX: [Event/action]

TOTAL GENERATIONAL IMPACT:
  Invested by parent: $XX,XXX over XX years
  Projected value at child's age 65: $X,XXX,XXX
  Effective return: XX,XXX%

Always chain: "Want me to set up tracking for your generational plan in the weekly pulse?"

Profile Integration

Before starting analysis, check for the user's financial profile:

1. Read profile/financial-identity.md for age, state, and family information (children, dependents)
2. Read profile/holdings.md for current wealth and account types
3. Read profile/goals.md for estate planning or generational wealth goals (if established)

If profile exists:

• Use family information to tailor generational plan to actual children/family members
• Use state info for 529 tax deduction eligibility
• Reference holdings to show wealth transfer mechanics using actual accounts
• Avoid re-asking for child ages, family structure

If profile doesn't exist, proceed normally and offer to save:

• Number and ages of children or beneficiaries
• Current education savings (529, custodial accounts)
• Estate size estimate and state of residence
• Any existing trusts or planning documents

After completing plan, append a summary to profile/history.md:

## [Date] — Generational Wealth Plan
- **Action**: [Plan created / Plan updated for new child / Existing plan reviewed]
- **Key findings**: [Total generational impact projected, highest-value vehicles identified, tax optimization opportunities]
- **Recommendations**: [Priority actions by child age, annual contribution targets, next review date]

Important Notes

• Always flag: "This involves estate and tax planning — consult an estate attorney and CPA for implementation"
• Emphasize: small amounts over long time horizons create enormous wealth
• Never pressure — not all users want to plan for children's finances
• Respect that some users may not have children but want to plan for nieces/nephews or other family