This is How To Make Your Kid a Multimillionaire By Age 65, According to TikToker It all starts with $1,000 when they are born.

By Gabrielle Bienasz

Opinions expressed by Entrepreneur contributors are their own.

Social media creators love to talk about building wealth — sometimes not so well — and one TikToker is going viral for showing people a simple method for accumulating buckets of cash.

"What stands between you and growing generational wealth is just consistency and investing [with] compound interest," creator Haley Sacks told Entrepreneur.

Sacks is a TikTok and Instagram influencer who makes content about wealth building at @mrsdowjones. She is the founder of Mrs. Dow Jones and Finance Is Cool media and education companies and is a self-proclaimed "financial pop star."

According to Forbes, she's been studying the ins and outs of finance for about seven years.

In a video posted last week, Sacks talks about how you can use a custodial brokerage account to help a child in your life become a millionaire by age 65.

"Here's exactly how to grow generational wealth for the kids in your life, too," she says in the video.

@mrsdowjones Here's how to REALLY build generational wealth #financeiscool #generationalwealth #investing #investingforbeginners #bossmoves #brokerageaccount #custodialaccount #529plan #custodialrothira #godmother ♬ original sound - Bluey

Sacks added via the phone was inspired to make the video as she was bonding with her newborn goddaughter, Zia Copernicus Lake Yellen, ("She has artist parents," Sacks joked) and trying to remind herself not to buy her "cute little outfits."

"I just keep reminding myself, one dollar today is worth $10 tomorrow," she said.

Here are Sacks' recommended steps to building millions in wealth for a young person in your life.

  1. Open an account.

You can use various types of accounts to invest money for a minor, like a 529 Plan for someone's education or Custodial Roth IRA for retirement. She recommends the Custodial Brokerage Account because it has fewer rules.

Sacks said in the video that is because she wants her goddaughter "to have the freedom to use this money however she wants." A person over the age of 18 can open a custodial account for a minor and invest in it, and often family members do so.

They are pretty flexible: There's no limit to how much money you can put in each year, and the money can be used for literally anything, unlike a 529, which has to be used on education and related expenses, depending on the type, or the IRA, which actually can only have funds the child has earned put into it.

2. Put money into it.

Sacks recommended putting in $1000 at first, then $100 a month, and $500 on a kid's birthday.

3. Invest the money. Sacks advised going with an S&P 500 ETF.

"Historically these have returned 10%. You really can't go wrong," she added.

4. Stop investing when the child is 18. Let the interest accumulate to $7.6 million

Using a basic investment calculator, you can see how Sacks arrives at this number. The Capital Group's investment calculator shows if you put in $1,000 as your initial investment, and $142 a month (if you spread out the birthday $500) for 18 years at 10% compounded annually, you get $87,408.40.

Then, you redo the calculation with that number, putting no contributions but letting the $87,408.40 sit and gain interest for 47 years — until the child is 65 — it would come out to $7,709,205.57.

"How nuts is that," Sacks says on TikTok.

Gabrielle Bienasz is a staff writer at Entrepreneur. She previously worked at Insider and Inc. Magazine. 

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