AA opinions for a 20 year old disabled adult

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monicafaye
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Joined: Thu Mar 18, 2010 8:39 am
Location: San Antonio, TX

AA opinions for a 20 year old disabled adult

Post by monicafaye »

I have a 20 year old son disabled from birth with $9,000 from an inheritance to invest. He currently lives at home and has a part-time job. He understands the importance of saving. He also understands the concept of frugality, which as a disabled person with limited current and future earning power is important. I want to help him invest his money in Vanguard Funds and encourage him to continue to invest as he gets older. I would appreciate opinions on which funds to put him in. He already has a MMF at Vanguard. Thanks for you help.
GammaPoint
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Post by GammaPoint »

Maybe a Target Retirement fund would be best? See https://personal.vanguard.com/us/funds/ ... rementList.
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White Coat Investor
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Post by White Coat Investor »

I assume he is in the accumulation phase given his disability income and part-time job. I'd open a Roth IRA and buy an appropriate target retirement fund. Perhaps 2025 or so.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course
ResNullius
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Post by ResNullius »

I would stay on the very, very conservative side of investing. For someone in his situtation, he should invest as if retirement is just around the corner, because he'll never knows what might happen to his income stream down the road. Good luck.
sheople2
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Re: AA opinions for a 20 year old disabled adult

Post by sheople2 »

monicafaye,

I've sent you a PM. Please look when you get a chance.
Last edited by sheople2 on Sun Apr 25, 2010 10:06 pm, edited 1 time in total.
mortal
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Post by mortal »

Your son doesn't need to invest the money he has now. If he's 20 years old, and has any mental capacity to learn he needs to:

GET A COLLEGE EDUCATION

I have a permanent disability. I can say without a shadow of a doubt that without my degree that I would still be perpetually broke, collecting $600/mo disability checks. They are a poverty trap. The social security administration places severe restrictions on a persons income and net worth while receiving disability. This effectively means that a person on disability cannot legally earn or save very much money at all. I know this sounds "as it should be" to those who haven't been there, but trust me, it's fairly hard to put yourself through school on so little. Thankfully, I received some assistance (grants, parents, etc) that helped me along the way.

Edit for clarification:
I no longer receive ssdi. That ended as soon as I got a decent part time job in college.

Also, second related point. If you're in college, participate in the coop program! That work experience was the single greatest thing I got out of college.
Last edited by mortal on Mon Apr 26, 2010 7:38 am, edited 1 time in total.
BW1985
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Post by BW1985 »

mortal wrote:but trust me, it's fairly hard to put yourself through school on so little. Thankfully, I received some assistance (grants, parents, etc) that helped me along the way.
How is this different than anyone else though? Loans for school, career after school = off disability.
sheople2
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Post by sheople2 »

Hi Mortal. I sent you a PM. Thanks.
Valuethinker
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Re: AA opinions for a 20 year old disabled adult

Post by Valuethinker »

monicafaye wrote:I have a 20 year old son disabled from birth with $9,000 from an inheritance to invest. He currently lives at home and has a part-time job. He understands the importance of saving. He also understands the concept of frugality, which as a disabled person with limited current and future earning power is important. I want to help him invest his money in Vanguard Funds and encourage him to continue to invest as he gets older. I would appreciate opinions on which funds to put him in. He already has a MMF at Vanguard. Thanks for you help.
The interaction between state support and his income and assets is of great concern here.

Likely he will be dependent on at least some government support in his life. Much of that is means tested? For example in the UK, the disqualifier is £16k of personal assets. Above that, many state benefits are withdrawn.

There may be sites for those with disabled children which consider these issues.

Other than that, a conservative asset allocation.

I would propose something like US iBonds, $5000, and Vanguard TSM, $4000.

My thoughts being that in the long run stocks should do well, and conversely iBonds provide a positive return, after inflation (a very small one, right now, unfortunately), and the ability to be turned into cash to meet emergencies.
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