Phase 1 - Parents fund it (0-18 years):
You put $1,000 at birth. Then $500 every birthday ($9,000 total) + $250 every single month for 18 years ($54,000). So you invested about *$64,000* out of pocket.
But invested in the S&P 500 averaging 10% per year, money doesn't just sit — it earns money on its money.
By the time your kid is 13, that pot is already ∼$165,000. The interest is now bigger than what you put in.
*Phase 2 - Kid takes over (18-43 years):*
At 18, you stop. If your kid just keeps the same habit — $250/month from their own job — they never need to earn six figures.
$165k compounding for 25 more years + $250/month = *$1.25 million by age 43*. Total they added was only $75k.
The lesson: You bought them 18 years of time, which is worth more than money. Generational wealth isn't about being rich — it's about starting early and never stopping.