How to Legally Pay Your Kids a Salary — And Turn It Into a Million-Dollar Tax-Free Retirement Plan
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By Anil Aggarwal | Real Estate Broker, Investor & Financial Educator
732-877-8585 | Anil.aggarwal@vylla.com
401kExposed.com | 529PlanExposed.com
Pay Your Kids — Save on Taxes — Build Their Wealth
Most parents don’t realize they can legally pay their kids to work for their business. Under IRS guidelines, you can pay each child up to $13,850 per year (2024 standard deduction) without them owing federal tax. Better yet, you can deduct that salary as a business expense.
Example:
You pay your 10-year-old $12,000/year for helping in your business (photos, organizing files, social media content, etc.). That’s:
$0 income tax for the child $12,000 tax deduction for your business And a great financial lesson for your kids!
From Salary to Long-Term Wealth via IUL
Take that tax-free income and invest it into an Indexed Universal Life (IUL) Insurance policy, where it grows tax-free over time. Historically, carriers like AIG have returned ~7% annually.
Let’s say:
$12,000/year × 10 years = $120,000 With compounding at 7%, this can grow to $1M+ by age 60 Tax-free loans can be taken in adulthood — while the cash value continues growing
Why This Beats Traditional Plans
Compared to 401(k) or 529:
No penalties for early withdrawal No taxes on loans taken from the policy Full flexibility for future needs — education, house, or retirement
Real-World Strategy, Not Just Theory
Anil Aggarwal has helped families implement this method — combining tax-smart income planning with wealth-building insurance strategies.
Important Disclaimer
This information is provided for educational purposes only and should not be considered financial or tax advice. Always consult with a qualified CPA or licensed financial professional before implementing any tax or insurance strategies.
Want to Learn More?
Call or text Anil Aggarwal: 732-877-8585
Visit: 401kExposed.com | 529PlanExposed.com
Email: Anil.aggarwal@vylla.com
Let’s Build Tax-Free, Generational Wealth — Together.
