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  • Four Unique 529 Benefits for Pennsylvania Residents

    Summary

    If you live in Pennsylvania, you have access to one of the most generous 529 policies in the country. You get:

    • Unusually generous state tax deductions at $19,000 per person, per beneficiary
    • Deductions that apply to any state’s 529 plan, not just PA
    • Up to $20,000/year in K-12 tuition withdrawals per beneficiary
    • Exemption from PA inheritance tax. 

    We are flat fee financial advisors based in the Philly area and help families understand how these benefits incorporate into an optimized financial plan. Let’s explore each of these in more detail.

    Pennsylvania has a $19,000 state tax deduction per person, per beneficiary

    Most states cap their 529 deduction at a flat number, often just $5,000 to $10,000 per year, regardless of how much you contribute. And this is typically per married couple, not per beneficiary.

    Pennsylvania really cranks up the 529 plan deductions. PA allows up to $19,000 per contributor, per beneficiary. That means a married couple can contribute up to $38,000 per beneficiary. Because the limit applies per beneficiary, a family with three kids could potentially deduct up to $114,000 in a single year. 

    How much is all this worth?

    PA’s state income tax rate is 3.07%. That means every $10,000 you contribute to a 529 plan is worth $307 in tax deductions. A married couple maxing $38,000 in contributions for a child is getting $1,166.60 in state tax deductions.

    Deductions apply to any state’s 529 plan

    Here’s a detail people often miss. Pennsylvania has tax parity, meaning you get the state deduction even if you use a 529 plan sponsored by a different state. You are not limited to just PA’s own PA 529 plan. 

    Each state’s 529 plan investment options, online experience, and fees are different. If another state’s plan has lower fees or better investment options for your situation, you don’t lose the PA tax benefit by using it.

    You can use a 529 for K-12 tuition expenses in Pennsylvania

    529 plans aren’t just for college anymore. As of Jan 1, 2026, Pennsylvania allows up to $20,000 per year, per beneficiary to be withdrawn tax-free from 529 plans for qualified K-12 tuition expenses at public, private, and religious schools. 

    This is a meaningful planning opportunity for families already paying private school tuition directly from a checking account.

    Running tuition payments through a 529 first, even briefly, can capture the state tax deduction on money you were going to spend anyway, as long as you’re following the funding-then-withdrawal sequence correctly. This means you’re effectively getting a 3.07% discount on tuition expenses you were going to pay anyway.

    529 accounts are exempt from PA state inheritance taxes

    PA’s state inheritance tax can run as high as 15% for non-lineal heirs. 

    The entire value of a 529 account is exempt from Pennsylvania inheritance tax for state residents for any beneficiary relationships. 

    For families thinking about multi-generational education funding such as grandparents contributing to a grandchild’s account, this is a genuinely useful, PA-specific estate planning tool, not just a college savings vehicle. You get three distinct tax advantages: the state tax deduction for the contributions going in, tax-deferred growth of those assets, and then funds being passed on without state inheritance tax. 

    Reach out if you’d like help with your K-12 or college education planning.

    Educational funding is one of the main areas we work through with our Pennsylvania-based clients, particularly families navigating the cost of K-12 private school alongside college savings at the same time.

    If you’re trying to figure out how to afford private school, sequence 529 contributions, tuition payments, and other savings goals, this is exactly the kind of decision we help clients work through and we’d love to help.

    If you found this content useful, you might also like:

    Nathan
    Founder & Lead Advisor
    [email protected]

    The Tradeoff

    Most financial advice is generic. Mine isn’t. Get an email every other week with real strategies and stories from my work with mid-career professionals. Free, no paywall.

    Check it Out

    Kangpan & Co. is a flat-fee financial advisory firm specializing in helping mid-career professionals navigate the career, family, and financial tradeoffs that come with this stage of life. This content is for educational purposes only and is not financial, legal, or tax advice. Consult a licensed advisor for help with your individual situation. Employees and clients of Kangpan & Co. may hold positions discussed in our content. Past performance is no guarantee of future results.

  • How We Manage Your 401(k) Rollover

    Summary:

    We are fee-only financial advisors who helps clients roll over their 401(k) balances into IRAs. This is not a generic explainer of “how rollovers work.” Most of what happens in a 401(k) rollover isn’t a decision you need to make; it’s paperwork and process that we handle. Here’s the exact process, step by step, including what happens if your provider sends a check instead of a wire, how long this all takes, etc.

    Our 401k Rollover Advisory Services

    Most articles about 401(k) rollovers are written for people who are doing it themselves. This one isn’t. This article is about what we actually do for our clients.

    • We offer hands- on 401k rollover services to our wealth management clients as part of their relationship.
    • We also offer our 401k rollover services on a standalone, one-time fee basis for people who like managing their own investments but just want objective advice on whether a rollover makes sense and assistance with the rollover process itself.

    The Entire Process Takes About 30 Minutes of Your Time

    In our experience, the anxiety around a rollover has almost nothing to do with the financial mechanics and almost everything to do with not knowing what’s about to happen to your money or how long or complicated everything will be.

    Here are the key steps:

    • Send us your latest 401(k) statement
    • Set up an IRA if you don’t have one already
    • Call your 401(k) provider together
      • If your provider sends the funds directly, we’re finished
      • If your provider sends a check, I’ll provide an envelope for you to forward
    • We then let you know when the funds have been received and then invest them according to your investment strategy

    The process on your end will take about 30 minutes active time in total.

    Note, at this time we primarily use Schwab as our custodian so all steps will refer to how our process works with them. Let’s dive into each of the steps.

    Step 1: Send us your latest 401(k) statement

    We need your statement in order to:

    • Confirm your name and address. To avoid complications, we need to check your name and address with your 401(k) provider matches your name and address at Schwab.
    • Check that your funds have all vested. Some 401(k) plans have vesting periods. If you transfer funds before they are fully vested you may be leaving money on the table.
    • Ensure we set up the right types of accounts with Schwab. Some clients contribute to traditional, pretax 401(k) plans, others use Roth 401(k), and some have a mix of both. 401(k) funds must be sent to the corresponding IRA types.
    • Get the contact information of the plan provider. This will be used for when we reach out to them together in Step 3.

    Step 2: Set up IRAs at Schwab if we don’t have them already

    We need to make sure we have somewhere for your 401(k) funds to go. If we haven’t set up IRAs already, we will need to do this before reaching out to your 401(k) provider.

    As with most our account setup processes, we streamline this for you. Our team will set up the account details with Schwab and then you will receive a DocuSign that takes no more than a minute to review and complete. Your account will be ready within 2-3 days.

    Step 3: Call your 401(k) provider

    While some providers allow direct 401(k) rollovers, our experience says most do not and it is often quicker and easier just to call them. Here’s what this looks like:

    • Call Provider Together: We need to call them together so that you can authenticate yourself as the owner of the account and authorize me to speak on your behalf. I will handle most of the conversation from here.
    • Confirm Direct Rollover: We will confirm with the plan provider that we are going to do a Direct Rollover into accounts held at Schwab. They will typically ask for the account numbers which I will provide.
    • Review Plan Details: They will typically provide you with a summary of your current plan balances, an estimate on timing to receive the funds, and other information. I’ll write all this down and can provide you the summary if you’d like.
    • Confirm Distribution Process: We found about half of providers will send the check directly to Schwab which requires no additional work from you. The other half will send you a check directly which then needs to be sent to Schwab. If this is the case, we will send you a stamped envelope along with a note to Schwab that provides some additional instructions to them. All you need to do when you receive the check is put it into this envelope and drop it in the mailbox.

    Step 4: Confirm funds received

    We will monitor your account with Schwab and let you know once they have received the funds or if there are any additional steps that require your attention. Funds typically arrive within 7-10 business days of checks being sent out.

    Once the funds have been received, we will then invest them according to the investment strategy we have aligned on with you.

    The fine print

    This process describes how Kangpan & Co. typically handles 401(k) rollovers for clients; individual provider requirements and timelines vary.

    It’s important to note that rolling over a 401(k) is not always the right choice. Some employer plans have lower costs or unique investment options (e.g., stable value funds) not available outside the plan.

    If you found this helpful, you might also want to check out:

    Nathan
    Founder & Lead Advisor
    [email protected]

    The Tradeoff

    Most financial advice is generic. Mine isn’t. Get an email every other week with real strategies and stories from my work with mid-career professionals. Free, no paywall.

    Check it Out

    Kangpan & Co. is a flat-fee financial advisory firm specializing in helping mid-career professionals navigate the career, family, and financial tradeoffs that come with this stage of life. This content is for educational purposes only and is not financial, legal, or tax advice. Consult a licensed advisor for help with your individual situation. Employees and clients of Kangpan & Co. may hold positions discussed in our content. Past performance is no guarantee of future results.

  • The Four Money Personalities I See in High Earners

    How a person handles their money says a lot about who they are, what they believe in, and their overall approach to life. 

    I manage money for high earners and multi-millionaires. I see four consistent money “archetypes” across this group:

    • The Compounder
    • The Cruiser
    • The Spender
    • The Independent

    There is no right or wrong archeteype. You can be happy or miserable regardless of which type you fall into. The key is being aware which one you are and managing your life and finances in a way that aligns with the personality.

    For example, the generic financial advice to get a job and then save 10% a year until 65 works well for a Cruiser but will feel heavily restrictive and out of alignment with an Independent. 

    People can have aspects of multiple archetypes, but there is usually a dominant one that drives life and financial decisions. 

    Let’s get into each.

    The Compounder

    Compounders view money as a game to be beaten. The highest score at the end wins. They’re constantly thinking about investing, starting new businesses, etc. It doesn’t matter if they have $3m or $20m in assets. Their goal is to at least 10x whatever it is they have now (and then 10x again after that).

    The purpose of money is to get more money. 

    A lot of very successful business owners and entrepreneurs are in this group. Done well, it leads to a life of heavy intellectual engagement and a prominent role in the community creating jobs and building the local economy. Taken to extremes you end up with Ebenezer Scrooge. You build a huge cash pile but end up having no one to share it with. You prioritized the money over relationships with your kids, friends, or your community.

    Financial strategies developed for this group have a heavier weighting towards business management, tax and estate planning, and unique investment access. 

    The Cruiser

    These are the people where money seems to have no intrinsic value outside of supporting daily living needs. These are the millionaires you read about in popular financial media who still go to their 9-5 jobs, drive a Toyota and shop at Costco. 

    Money is a byproduct of living.

    They’re generally content with what they’re already doing in work and life and can’t envision doing something else. So they keep going down the same path year after year. Work a reasonable amount at job they mostly enjoy. Spend quality time with family and friends outside of work. Their brokerage and retirement accounts grow larger every year but they barely notice. 

    They don’t think about money that often and are generally content with what they have. 

    This is where the standard financial playbook works well. Get a good job you like and stay till 65+. Contribute to your 401k along the way, don’t take on too much debt, and have a simple estate plan in place.

    The risk with this group is their money ends up creating problems down the line for other people. Not everyone is passive when it comes to money. Their children could end up fighting over the way the state distributes everything. Or they pass away and their husband gets remarried and a significant portion of the estate ends up going to the new wife’s adult children instead of their biological children.  

    The Spender

    These are the people who see money as something to be enjoyed. You can’t take it with you, so spend it while you’re alive. 

    This doesn’t always mean buying extravagant things for themselves. The money can go to helping loved ones like covering the down payment for their children’s first house or donating to causes they believe in.

    Money is what enables the good life.

    But we all know the extreme versions of this. The spendthrift who takes on too much debt to fund a life they can’t afford and ends up broke or working well past 70 to support themselves.

    I don’t see this version too often in my practice. Most of the people I work with are self-made through years of disciplined saving and investing rather than inheriting sudden windfalls. The muscles to build and maintain wealth have been well-established. 

    Budgeting and asset bucketing plays a bigger role for Spenders than other archetypes. They often need a bit of help managing the cash inflows and outflows in a way that maximizes life enjoyment while mitigating the risks of running out of funds.

    The Independent

    The final group are the ones that treat money as an employee. They want their money to work for them and typically have a goal of building up their portfoio to support their desired lifestyle in perpetuity.

    Money is infrastructure to this group.

    These are the people who like to build passive income, think a lot about financial independence, and ultimately want to retire from the “have to work for money” world in order to spend their time pursuing their passions and have control over their time.

    If you push too hard here you get the extreme versions of FIRE. 

    People who claim money isn’t important, but the only thing they think or talk about is the marginal cost of everything and how to reduce it. Their entire life and personality ends up being about money. Life gets put on hold while they build up their nest egg. They miss out on lots of experiences and potential friendships along the way due to their excessive frugality.

    Financial strategies for this group focus heavily on tax / fee optimization, cashflow management, and budgeting.

    I’m 80% Independent and 20% Compounder

    The interesting thing is about all these groups is that most people don’t know which they’re going to fall into until they’ve started building their wealth. 

    I used to think I was primarily a Compounder. That the point of money was to beget more money. I wanted to have the most of it among my family and friends.

    But once I started earning enough to start building up my savings and investments I realized I was actually much more of an Independent. It gradually became more important to me to be able to balance work, life, and family on my terms rather than getting a high score.

    I started aligning my financial goals to creating a portfolio that could support our living expenses, giving myself the freedom to build a financial advisory practice the way I wanted to without having to sacrifice my vision for the sake of rapidly building revenue.

    Which are you? If you’re not sure, feel free to reach out and I can help you figure out your money personality and how best to align your life and finances to who you are.

    If you liked this post, you might also want to check out:

    Nathan
    Founder & Lead Advisor
    [email protected]

    The Tradeoff

    Most financial advice is generic. Mine isn’t. Get an email every other week with real strategies and stories from my work with mid-career professionals. Free, no paywall.

    Check it Out

    Kangpan & Co. is a flat-fee financial advisory firm specializing in helping mid-career professionals navigate the career, family, and financial tradeoffs that come with this stage of life. This content is for educational purposes only and is not financial, legal, or tax advice. Consult a licensed advisor for help with your individual situation. Employees and clients of Kangpan & Co. may hold positions discussed in our content. Past performance is no guarantee of future results.

  • How Much Should High Earners Have in an Emergency Fund?

    Summary: I’m a financial advisor for mid-career professionals. This post covers the most common questions I get from clients about their emergency fund needs:

    • What is an emergency fund?
    • What do high earners actually need an emergency fund for?
    • How to calculate your monthly burn rate
    • How many months of expenses should you keep on hand?
    • How much cash is too much? The one-year ceiling

    What is an emergency fund?

    Emergency funds are cash set aside for sudden, surprise costs or job losses. They act as a cushion between the financial shock event and having to take on debt or sell your long term investments to pay for these expenses. 

    What do high earners actually need an emergency fund for?

    One of the first questions that comes up during planning discussions with high-earners is whether they have enough in their emergency fund. 

    In most cases, there is a sizable amount of cash and enough month to month cashflow that could cover most one-off, surprise expenses that come up over the course of a year like having to replace the water heater, an unexpected overseas trip to celebrate a friend’s 40th birthday, etc. 

    What an emergency fund usually needs to protect against for this group is unemployment. Fixed costs like mortgages and day-to-day living expenses like feeding a family of four are typically high and difficult to pull back quickly. And these are all supported by a job that produces the income to pay for these things. 

    How to calculate your monthly burn rate

    Start by figuring out how much your total monthly expenses are. You should include things like:

    • Mortgage
    • Other loan and debt payments
    • Insurance premiums
    • Living expenses
    • Childcare

    Living expenses like dinners out, birthday parties, vacations, etc. can vary month to month. You can take your past year’s credit card and checking statements and divide by 12 to get a more smoothed result.

    The sum of all these is your total cost of living and it’s what you need to continue to cover if you lose a job or experience some other kind of financial setback.

    How many months of expenses should you keep on hand?

    Once you have your monthly living costs, you can then determine how much of a cushion you want in your emergency fund. This depends on your household’s circumstances and your family’s risk tolerance. 

    Here’s how I help clients think about how much they should have put aside.

    Three months is the bare minimum.
    If anyone comes to me with less than this, you can bet it’s going to be a priority to get this built up unless there’s a really good reason not to. I use three months as the minimum because the US Bureau of Labor Statistics (BLS)1 consistently finds the median amount of time someone spends looking for work when they become unemployed is 7.9 to 11.6 weeks. In the event you lose your job and your income is impacted, you should plan on your funds being able to support your life for at least this long.

    Six months if you’re more conservative or a family relying on a single income.
    The June 2026 BLS found the average duration of unemployment was 25.5 weeks. If you are more conservative or your household only has one income earner, then six months may be a more comfortable cushion to build towards. It doesn’t have to be all at once, but should be something you steadily work towards over the course of a year or two.

    How much cash is too much? The one-year ceiling

    Usually no more than one year. Past this point, you’re not really buying more safety, you’re paying for it. Even the most conservative unemployment stretches rarely run past ten to twelve months. Too much cash has real opportunity costs. According to Portfolio Visualizer2, a dollar invested in cash in Jan 1996 became a bit more than $2.03 by the end of June 2026. That same dollar invested in the US Stock Market became $20.23.

    Learn More

    Every number in this piece is a starting point, not a definitive answer for you. The right cushion for you depends on your job stability, your household’s needs, and what else you’ve got backing you up. If you want help figuring out your liquidity needs, feel free to reach out.

    Nathan
    Founder & Lead Advisor
    [email protected]

    The Tradeoff

    Most financial advice is generic. Mine isn’t. Get an email every other week with real strategies and stories from my work with mid-career professionals. Free, no paywall.

    Check it Out

    Kangpan & Co. is a flat-fee financial advisory firm specializing in helping mid-career professionals navigate the career, family, and financial tradeoffs that come with this stage of life. This content is for educational purposes only and is not financial, legal, or tax advice. Consult a licensed advisor for help with your individual situation. Employees and clients of Kangpan & Co. may hold positions discussed in our content. Past performance is no guarantee of future results.

    1. US Bureau of Labor Statistics. June 2026 Report, Table 12: Unemployment.
    2. Portfolio Visualizer Asset-Level scenario modeling for “Cash” and “US Stocks.” Gross returns only, does not include the impact of taxes or fees. January 1996 through June 2026. Data availability upon request.

  • Should I Invest in SpaceX?

    Clients have been asking me whether or how they should think about investing in SpaceX.  

    Here’s what I tell them. 

    You may already own it. You probably will soon if you don’t.

    I’m not Gordon Gekko. I don’t have special insight into how SpaceX or any other publicly listed company is going to do over the next few years. 

    Neither do hedge fund managers or big asset managers with hundreds of analysts focused on answering this question (despite what their marketing teams want you to believe). Large cap passive indexing beats the vast majority of professional active managers. 88.3% of them over a 15-year period according to S&P’s SPIVA report.

    SpaceX has already been incorporated into the Nasdaq 100 index. If you own a fund that tracks the index, you already own SpaceX.

    SpaceX could get incorporated into the S&P 500 index as soon as June 2027 if it meets certain hurdles.

    Sometimes the follow-up in this conversation goes like this.

    What if I can’t wait or really want it now?

    If you absolutely can’t wait for it to get added to an index you don’t already own then you could add a small position now that represents it’s weight in your chosen index as if it were already incorporated.

    Sizing a small position to match SpaceX’s eventual index weight is just indexing a little early. You’re not trying to outguess the market. You’re letting the market’s own weighting decide the size for you.

    If you like thinking about investing and portfolio construction, check out some of these other posts:

    Or feel free to reach out to me directly at [email protected] if you want someone to help you think through how to optimize your portfolio strategy.

    Nathan
    Founder & Lead Advisor

    Kangpan & Co. is a flat-fee financial advisory firm specializing in helping mid-career professionals navigate the career, family, and financial tradeoffs that come with this stage of life. This content is for educational purposes only and is not financial, legal, or tax advice. Consult a licensed advisor for help with your individual situation. Employees and clients of Kangpan & Co. may hold positions discussed in our content. Past performance is no guarantee of future results.

  • What Our Family Vacations Are ‘Costing’ My Retirement

    $1,223,565. That’s how much our family vacations are reducing our future retirement.

    I’m an optimizer by nature. Our current $10,000 a year vacation budget invested instead at 8% for 30 years compounds quickly.

    It’s a big number on a spreadsheet.

    But not all numbers are worth optimizing for. It took me a long time to learn how to live more in the moment instead of saving for a vague future (and I’m still building reps here).

    Traveling has gotten a lot more expensive and a lot more complicated with two young kids. Opportunity cost numbers on the spreadsheet keep getting higher.

    But we’re going to laugh for years about our stroll through Savannah where our daughter talked to her grandma for half an hour about how much she loved her other grandma’s cooking.

    And I’ll always remember the smile on my son’s face when he saw we were going on a boat ride in Sarasota (the only words he knew at the time were boat-boat and no).

    These memories are worth the price of admission.

    Retirement may only be 20% of your life. Don’t sacrifice too much of the rest saving for it.

    If you like thinking about the time value of your life vs. your money, check out some of these other posts:

    Or feel free to reach out to me directly at [email protected] if you want someone to help you think through these kinds of tradeoffs.

    Nathan
    Founder & Lead Advisor

    Kangpan & Co. is a flat-fee financial advisory firm specializing in helping mid-career professionals navigate the career, family, and financial tradeoffs that come with this stage of life. This content is for educational purposes only and is not financial, legal, or tax advice. Consult a licensed advisor for help with your individual situation. Past performance is no guarantee of future results.

  • Where Do Trump Accounts Fit In?

    People have been asking me how Trump Accounts fit in the mix of options for setting their kids up for the future. Here’s how I think about it based on their current form.

    First, take any free money on offer:
    – For any of your kids born between Jan 1, 2025 and Dec 31, 2028, signing up is a no brainer. You get a $1,000 seed deposit from the government for enrolling.
    – Similarly, it makes sense to enroll if your employer offers contributions to these accounts as part of your benefits package.

    If you’re not eligible for free money, then signing up depends on what your goals are.

    Trump accounts should be viewed as retirement savings vehicles that you can contribute up to $5,000 a year for children under 18. There are no in-year tax deductions for making these contributions, but the funds will grow tax-deferred.

    Once your kid turns 18 the the account will be treated like a Traditional IRA. Contributed funds will continue to grow tax deferred. Anything they take out before they turn 59.5 will be taxed at their income rate and come with penalties (with some exceptions). The penalties go away after 59.5.

    But there are plenty of other options for setting your kids up for the future. Here’s a high level framework for thinking through what makes sense for your objectives.

    Each come with unique benefits and limitations. The flow in the chart is based on the role each of these accounts were intended for. There are other funding strategies if you want to prioritize tax mitigation, control, flexibility, etc.

    If you’re thinking about your children’s future, check out our other posts:

    Or feel free to reach out to me directly at [email protected] if you want a second opinion on financial planning for your children.

    Nathan
    Founder & Lead Advisor

    Kangpan & Co. is a flat-fee financial advisory firm specializing in helping mid-career professionals navigate the career, family, and financial tradeoffs that come with this stage of life. This content is for educational purposes only and is not financial, legal, or tax advice. Consult a licensed advisor for help with your individual situation.

  • The Four Disadvantages of Trump Accounts

    We have young kids. I manage money professionally. I’m not planning on opening a Trump Account for either of them. 

    Trump Accounts are designed to serve a specific purpose. To help your child get a head start on saving for their retirement. Sounds good right? 

    Here are the disadvantages in how these accounts are designed:

    • Your child takes control of the funds when they turn 18
    • It detracts from college funding
    • It’s an inefficient way to fund your kids’ retirement
    • Life’s big expenses are front-loaded 

    Your child takes control of the funds when they turn 18

    I’m going to give an 18 yr-old $187,251 on their birthday and see what they do with it. Good idea, right?

    That’s what $5,000 a year for 18 years into a Trump Account earning a hypothetical 8% a year grows to. And then the kids legally get the keys to the playground on their 18th birthday.

    Sure, it’s technically a retirement account with a 10% penalty if you withdraw before 59.5.

    I’m not convinced every 18 yr-old thinks about the $18.7k penalty when they’re looking at the $170k+ payday they get to keep. (And yes, they forgot to account for taxes on emptying the account so now they owe money).

    Every account and planning strategy has pros and cons. Funds growing tax-free is definitely a Pro of the Trump Accounts. My kids automatically taking control of the funds at 18 feels like a big Con.

    It detracts from college funding

    I’m guessing that if you’re the type of parent who has read this far, you already have colleges in mind that you want your kids to go to. Even if college is almost two decades away.

    According to the Education Data Initiative1, the all-in, four-year cost of a private, non-profit college degree is $226,512. And costs have been growing at 4.04% a year. 

    If trends continue, then 18 years from the now the all-in cost will be $462,059. 

    529 plans were created to help with this immense cost. Like Trump Accounts, the contributions grow tax-deferred until you need them.

    But unlike Trump Accounts:

    • Contributions going in are tax deductible in many states
    • Funds used for qualified expenses are not taxed on their way out

    If your state has tax deductions for 529 contributions and you plan to send your kids to college, max out your college savings first before putting money in the Trump Accounts.

    It’s an inefficient way to fund your kids’ retirement

    I’m 40. Sheila probably won’t appreciate me saying exactly how old she is so I’ll just leave it at she’s slightly younger than me. 

    Our eldest is 4. By the time she’s 59.5 and can start accessing funds in a Trump Account without penalties, I’ll be 95.5. According to the CDC2, the average life expectancy of a male born in the US is 76.5. females are 81.4.

    Maybe we make it two decades past the average person. But odds are we won’t. 

    We plan on leaving money for our kids. 

    Anything in a Roth they can tap tax-free even if they’re not 59.5 (as long as the account has been open at least 5 years). 

    Anything in a taxable brokerage account transfers to them essentially with capital gains reset to 0. That means all those funds will be available to them tax-free when they transfer over if they need it. More than likely before they’re 59.5.

    If our daughter (or son) had a Trump Account, any gains over the amount that had been contributed would be taxed at her marginal income rate when she starts using the funds.

    Life’s big expenses are front-loaded 

    Let’s say you’re 38 right now. You’re married and have two kids. You both have good, but not quite S-tier income from jobs you enjoy (more or less). You work in marketing. Your wife is a physician.

    You’ve both been diligently saving for retirement and have built up about $1m between your workplace retirement plans. But that doesn’t help you right now.

    You’re trying to figure out how to pay for $42k a year in combined K-12 private school tuition while still getting to go on your twice-yearly family vacations. 

    What would be more helpful? 

    A. Your parents decided to help you fund your retirement when you were a child. You have an additional $750,000 in another retirement account you can’t really touch until you’re 59.5. It’ll be nice to have then, but not life-changing.

    B. Your parents set money aside in their brokerage accounts anticipating they’d one day help out when it was needed. They each gift you $19,000 ($38,000) every year for the next five years to help cover the cost. (There are all kinds of ways to handle how this is done to optimize for taxes. That will be the topic of a future article).

    Having liquid optionality is highly underrated.

    When I Would Use a Trump Account

    I’m not fundamentally against Trump Accounts. There are scenarios where I would recommend or use them for our kids.

    You qualify for free money.

    By all means open an account if your’re being offered something for nothing. I can’t think of any reasons not to do these:

    • Your child was born between Jan 1, 2025 and Dec 31, 2028 and they qualify for the $1,000 government pilot contribution. (Our kids don’t qualify)
    • Your employer is planning to offer funding as part of their perks. (I am my employer)

    You’ve maxed out your other options. 

    This would be a good problem to have. 529 is fully funded or on its way to being funded. You’re maxing your own 401k, IRA, and HSA contributions. Etc. Go ahead and fund the accounts, they are one of the few ways to get tax-deferred growth on your money. (We have a ways to go on our 529)

    Know Your Tools

    Take a step back and think about how you want to set your kids up for the future because there are all kinds of tax and planning quirks to be aware of or take advantage of depending on your goals. 

    Remember, Trump Accounts are just one tool in a wide array of options to help set your child up for their future. As with all tools, it helps to understand the mechanics of how they work relative to others and what your goal is. 

    If you’re thinking about your children’s future, check out our other posts:

    Feel free to reach out to me directly if you want a second opinion on financial planning for your children.

    Nathan
    Founder & Lead Advisor
    [email protected]

    The Tradeoff

    Most financial advice is generic. Mine isn’t. Get an email every other week with real strategies and stories from my work with mid-career professionals. Free, no paywall.

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    Kangpan & Co. is a flat-fee financial advisory firm specializing in helping mid-career professionals navigate the career, family, and financial tradeoffs that come with this stage of life. This content is for educational purposes only and is not financial, legal, or tax advice. Consult a licensed advisor for help with your individual situation. Employees and clients of Kangpan & Co. may hold positions discussed in our content. Past performance is no guarantee of future results.

    1. Education Data Initiative, Average Cost of College & Tuition, last updated 2026-02-14
    2. CDC, Mortality in the United State 2024

  • Can You Afford to Take a Pay Cut for a Job You Love?

    I missed my daughter’s first steps because I was in meetings I don’t even remember.

    It didn’t feel like a big deal at the time. But years later I still remember the moment Sheila texted to say it was happening… and not one thing about the meetings that day.

    We knew it was going to happen soon. But it felt silly to work from home for the week just to try and be there for the moment. As a C-level exec in the company, I technically had the flexibility to do it. But it didn’t feel like a good enough reason to skip the company’s mandatory in-office policy at the time.

    This was just one of hundreds of small sacrifices I made to put career in front of life and family.

    This was also a key moment that shaped my Time Value of Life philosophy that I wrote about last time.

    I sat through thousands of meetings during my 16 years in the corporate world. Most of them were about nothing in particular. Many were just minor variations on the same thing over and over. I could have missed hundreds of these and my life and career would have been no different.

    But missing out on my daughter’s first steps was literally a once in a lifetime event.

    Nathan Kangpan with his daughter at the Ambler Music Festival
    Hanging out together at the Ambler Music Festival. I’ll never regret trading endless corporate meetings for more everyday moments with the fam.

    A lot of people I talk to have similar experiences and feelings about their evolving relationship between career and family. They’re looking for a way to balance more evenly between earning and living.

    They come to me because they feel trapped in their corporate careers. They want to take a different job they feel more passionate about or be able to spend more time with their families but are worried they can’t afford to take the pay cut.  

    They often have more financial flexibility than they realize. 

    Bridging an Income Gap Between Reality and a Dream Job

    Here’s a simplified example of the kind of conversation I have with people in this situation.

    • Jim and Sarah are both 38 and have two young kids. They’re like you and me. They live in the suburbs of a major city, shop weekly at Costco, hang out at the local brewery with their kids and friends on the weekend, etc.
    • Their total yearly spend across their mortgage, preschool, and living expenses is $200k.
    • Jim earns $80k a year after taxes at a small, independent marketing firm and loves his job.
    • Sarah is at a big law firm and clears $300k a year after taxes and maxes her 401k each year. But she travels all the time and is burnt out. She wants to go in-house at a local company where she can feel more ownership over the impact she has each day and be home more with the family. 
    • Unfortunately, the company will only pay her $90k a year after taxes. 

    A quick mental calculation shows Sarah’s $90k + Jim’s $80k is less than their $200k in living expenses. 

    The $30k income gap between dream and reality.

    Sarah really wants to take the job but the $30k shortfall is far from a rounding error. She feels like she can’t take the job without majorly reducing the family’s quality of life. She’s also worried about risking their retirement because there’s no room in this budget for 401k contributions.

    So we sit down together and look at the bigger picture. 

    Beyond their income, they have $750k in retirement accounts already and another $700k in their brokerage account, primarily invested in an S&P 500 index fund. 

    We identify three areas together that will help Sarah take her dream job and spend more time with her kids. 

    Costs: We map out all their costs and find there are $6k a year in convenience expenses that we could easily eliminate if Sarah is working more reasonable hours and traveling less for work. These convenience expenses are common in families with busy professionals and include frequent DoorDash orders, last minute childcare, etc. 

    Investment Income: Instead of keeping all $700k of their brokerage account invested in the S&P 500 index fund, we move part of the portfolio towards a diversified income strategy that aims to cover the $24k a year remaining expenses. We do this through a mix of dividend stocks, private real estate funds, and bonds. 

    Retirement: We model out how much their retirement accounts could be worth in the future if, in the worst case, they never contribute another dollar. $750k growing at 8% a year for 30 years = $7.5 million by the time Sarah and Jim expect to retire. We find this is more than enough to cover their expected living costs in retirement. This analysis helps Sarah realize putting more into retirement at this point is a nice to have, not a must have.

    This is just one of many ways to create a bridge from a high-paying corporate job that no longer fits who you are with that dream second act. One of the reasons I got into financial advisory is because I enjoy talking about investments and the markets. But I’ve since found the most rewarding projects I take on are the ones where a few hours of financial engineering helps someone take that dream job or step back for awhile to spend more time with their kids while they’re young.

    It’s a path I know well. I left my C-level corporate job for a second act that felt more meaningful professionally and more rewarding personally. Missing my daughter’s first steps was a valuable lesson. It’s one I only had to be taught once. I got to see my son take his.

    Nathan
    Founder & Lead Advisor

    P.S. — If you’re stressing about a version of Sarah’s $30,000 gap and don’t know what to do, that’s exactly what my Financial Runway Tuneup is for. Two sessions with me. A customized financial strategy and playbook you can run with afterwards. It’s just $599, with no ongoing commitment after. Email me at [email protected] to get the conversation started and see if we’re a good fit for each other.

    Kangpan & Co. is a fee-only, registered investment advisor specializing in helping mid-career professional navigate the work, life, and financial tradeoffs that define their 30s and 40s.

    This content is for educational purposes only and is not investment, tax, or legal advice. No post is an endorsement of any particular strategy or security. We do not receive any direct payments or commissions for securities discussed in our posts. Private funds are generally available only to ‘Accredited Investors’ as defined by the SEC. Figures presented are for illustrative purposes only. Past performance is no guarantee of future returns. Investing involves risk including the loss of capital. Employees and clients of Kangpan & Co. may hold positions in securities discussed in posts. Speak with a licensed tax, legal, or financial advisor before making any changes to your investments or financial strategies.

  • The Time Value of Your Life

    Conventional financial advice is built on a single insight: time multiplies money. The longer you’re invested, the more your money is worth in the future. Defer gratification now, maximize the number later. 

    Time has the opposite effect on your life. The more time that passes, the exponentially less time you have left. 

    Living a balanced life means ensuring you are properly weighing the time value of all your decisions. 

    The Time Value of Your Money

    Time is the cheat code to wealth. 

    A dollar invested at 8% a year when you’re 20 could grow to $31.92 by the time you’re 65. Time does all the work for you. 

    But that same dollar invested when you’re 50 would only grow to $3.17 by the time you’re 65 at that same 8%.

    Your invested dollar is worth exponentially more with each passing year. The goal is to start early and let your investments compound. This is known as the Time Value of Money and is one of the first things taught in Finance 101 courses.

    The Time Value of Your Life

    The Time Value of Your Life moves in the opposing direction as the Time Value of Your Money. It decays exponentially.

    Let’s say you’ll live to 80. 

    When you are five year old, you still have 75 years left on the clock. The next year of your life represents only 1.3% of your remaining life (1 divided by 75 remaining years). Time stretches out infinitely with all of life’s wonderful experiences still ahead of you.

    At 75, you have only five years left on the clock. The next year of your life represents 20% of your remaining life (1 divided by 5 remaining years). 

    And it’s not just time on the clock that’s exponentially running out. Life’s experiences have a rapidly decreasing shelf life. 

    At 20, you’ll have 60 years to look back on the memories from your summer road trip that you take with your best friends between sophomore and junior year. As Bill Perkins wrote about in Die With Zero, early experiences pay memory dividends throughout the rest of your life. 

    At 75? You have just five years to appreciate any new experiences or memories you make.

    This exponentially decreasing life to time relationship is what I call The Time Value of Life. It is the inverse of the Time Value of Money

    The Tradeoffs Between Time, Life, and Money

    Most conventional financial plans and advice are built entirely around the Time Value of Money. Save more when you’re young. Delay gratification. Get a high score at the end. 

    What they don’t account for is that every year you spend waiting to live the life you want is a year with a quantifiable and diminishing value on the other side of the equation. 

    The goal of life is to ensure you make the proper tradeoffs between the Time Value of Your Life and the Time Value of Your Money. 

    Understanding this duality can help you think through many of life’s important decisions. Let’s look at your career through these two tradeoffs.

    The Time Value of Your Career

    Let’s say you just graduated and are 22. You plan to work until 60. 

    You start the “career game” with 38 total working years. Your first year represents 2.6% of your remaining career (1 divided by 38 remaining years). You have zero net worth but at least your parents paid for college so you have no debt.

    Fast forward a bit through a few years of meetings, conferences, and late night deck updates. You’re now 40. You’re an SVP at a large company and have $2m saved across your retirement and brokerage accounts. And you’re able to put away an additional $150k a year.

    But you’re quietly unhappy. You’ve been thinking more and more about whether you’re on the right path. You secretly wonder if the career track that you fell into at 22 still represents who you’ve become decades later. 

    You’ve got a dream in the back of your mind. You want to start something of your own. Do work that matters and spend more time with your kids who are growing up way too fast.  

    You really want to take that leap but you’re making good money now and want to save up just a bit more before you leave the corporate world. So you wait a year. Then another year. Suddenly five years have gone by and you just lost 25% of your remaining career to indecision and the fear you may not have enough for retirement. 

    Five years of Sunday evenings wondering what might have been. Five years of being the person who almost did it. And the clock is running out faster and faster.

    What you didn’t account for was that your $2m invested at 8% a year when you were 40 could be worth $9.3m by the time you retired at 60. Even if you never contributed another dollar to retirement. 

    You traded 25% of your remaining career years for money you didn’t even need.

    Balance The Equations

    These are the kinds of tradeoffs people are making between the Time Value of Life and the Time Value of Money. 

    The conventional financial plan optimizes for the Time Value of Money. It does its job perfectly. What it doesn’t account for is what you’re giving up on the other side of the equation. 

    Your money has a time value. So does your life. The financial plan that ignores one of them isn’t complete.

    Nathan
    Founder & Lead Advisor
    [email protected]

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    Kangpan & Co. is a fee-only, registered investment advisor specializing in helping mid-career professional navigate the work, life, and financial tradeoffs that define their 30s and 40s.

    This content is for educational purposes only and is not investment, tax, or legal advice. No post is an endorsement of any particular strategy or security. We do not receive any direct payments or commissions for securities discussed in our posts. Private funds are generally available only to ‘Accredited Investors’ as defined by the SEC. The Personal Endowment is a conceptual investment framework customized to each client and does not represent a specific fund or guaranteed outcome. Employees and clients of Kangpan & Co. may hold positions in securities discussed in posts. Speak with a licensed tax, legal, or financial advisor before making any changes to your investments or financial strategies. Past performance is no guarantee of future returns. Investing involves risk including the loss of capital.

Kangpan & Company LLC is a Registered Investment Advisor with the state of Pennsylvania. All content on this site is for educational purposes only and should not be considered financial advice. Past performance is not indicative of future returns and all investing involves risk including the loss of capital. Individualized responses to persons in a particular state will only be made after complying with all regulatory requirements of that state. Kangpan & Company LLC is not responsible for the content of external websites linked from this site. For a full description of our services, fees, and other important information, please read our Form ADV Part 2A, which are available on the SEC’s website here. 

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Twice-monthly letters on the financial and emotional tradeoffs that come with mid-career success. No paywalls.

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