Worry About Yourself Before the Grandkids, Wes Moss Advises

Donna from Alaska wants to leave something for her grandchildren but at age 57, she only has $20,000 in her retirement account. On the plus side, she has $500,000 in assets and no debt.

Wes Moss had some advice on a recent episode of the Clark Howard Podcast. “Donna, you’re worried about your grandchildren,” he said. “I’m worried about you, Donna. I want you to figure out how to make this thing work.”

If Donna funnels her limited surplus into custodial accounts for the grandkids over the next decade, she risks arriving at 67 with a portfolio that cannot cover 25 or more years of living expenses, Moss said.

Moss brought up the Rule of 72: divide 72 by your annual growth rate to estimate how many years it takes money to double. “In 10 years, you’ll be 67,” Moss said. “10 years is a number we can work with. If money goes up by 7.2% over 10 years, money doubles. So that means that your $500K in assets, depending on where they are, could be worth about $1 million by the time you’re 67.”

That 7.2% assumption deserves scrutiny. The 10-year Treasury currently yields about 4%, so a Treasury-only portfolio will not compound at Moss’s rate. A diversified equity-heavy allocation historically has, but Donna’s $500,000 needs to actually be invested for growth, not sitting in cash.

Layer Social Security on top. Moss told Donna “you will likely have Social Security that is significant at age 67. And if your assets are at close to $1 million, then that should be plenty.” For a hypothetical 57-year-old claiming at full retirement age, a monthly benefit of roughly $2,400 combined with a 4% withdrawal from a $1 million portfolio produces a realistic income floor.

Why the Grandchildren Question Is a Trap

Co-host Christa DiBiase added, “There are no scholarships for retirement. So you can’t sacrifice being able to care for yourself in your older age to take care of your grandchildren.”

The broader savings picture sharpens the warning. The national savings rate is only about 4%. Americans are saving less of their disposable income, and grandparents in Donna’s position often feel pressure to fill gaps for family members who are themselves strained.

Once Donna has her retirement funding on track, she could consider setting up custodial accounts for her grandchildren. “The UTMA account[s] are basically custodial brokerage accounts for anyone who’s not an adult,” Moss explained. He suggested small amounts ($1,000 to $5,000) be seeded into a broad stock index fund rather than ongoing large contributions.

What Donna Should Do

1. Audit where the $500,000 sits. If it’s in cash or CDs, the Rule of 72 doubling does not happen. A mix weighted toward broad equity index funds is what makes Moss’s 10-year projection plausible.
2. Max the catch-up contribution. At 57, Donna qualifies for catch-up contributions to IRAs and 401(k)s. Funding these for 10 years materially changes the 67-year-old balance.
3. Run a Social Security estimate at SSA.gov. Knowing the real benefit at 67 tells Donna whether $1 million plus Social Security clears her expenses.
4. Cap grandchild gifts at a fixed annual figure only after retirement contributions are maximized. A one-time $1,000 UTMA seed per grandchild is generous without being self-destructive.

Moss’s core message: “The only answer long-term for Americans, more Americans to participate and have financial freedom is to start earlier. That’s the only thing we can control is time.”