New Analysis: Investing Tooth Fairy Money Could Payoff in Retirement

Under-The-Pillow-Savings Could Yield Billions in Retirement Money for Today's 6 Year Olds

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Aug 26, 2015, 01:42 ET

OAKBROOK, Ill., Aug. 26, 2015 /PRNewswire-USNewswire/ -- It'll take a little discipline and a lot of patience, but it turns out a good source for retirement income for today's kids may be right under their pillow. According to a new analysis out today from Delta Dental Plans Association, if today's 6 year olds invest all the money they receive from the Tooth Fairy, they could be sitting on a combined total of roughly $70 billion by the time they reach 67, the traditional retirement age.

That could mean a whopping $21,000 per child when current 6 year olds in the United States hit retirement age, if, that is, they invest all their Tooth Fairy earnings. Delta Dental's 2015 The Original Tooth Fairy Poll^® found the Tooth Fairy visited 81% of homes in the United States, meaning out of the current 4.1 million 6 years olds about 3.35 million received gifts.

The retirement income figure is based on a 6 year old (average age for 1^st tooth loss) receiving the national average Tooth Fairy gift of $4.36 (from Delta Dental's most recent survey of U.S. parents of 6-12 year olds), with 6.5% in-mouth inflation (the typical increase for Tooth Fairy gifts from year to year) for each subsequent tooth, and a 9.6% return on investment based on historic stock market returns (S&P 500 average) per year until they turn 67.

By region, the retirement savings will vary in line with the average 2014 Tooth Fairy gift:

Northeast: $20,477 (average 2014 Tooth Fairy gift of $4.16)
Midwest: $13,910 (average 2014 Tooth Fairy gift of $2.83)
South: $25,362 (average 2014 Tooth Fairy gift of $5.16)
West: $23,004 (average 2014 Tooth Fairy gift of $4.68)

According to Delta Dental's The Original Tooth Fairy Poll^®, the average Tooth Fairy gift reached a record high last year, up 24.6% from 2013 when the average gift was $3.50.

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About Delta Dental Plans Association
The not-for-profit Delta Dental Plans Association, based in Oak Brook, Ill., is the leading national network of independent dental service corporations. Delta Dental provides dental benefits programs to nearly 70 million Americans in more than 120,000 employee groups throughout the country. For more information, visit our website at deltadental.com.

SOURCE Delta Dental Plans Association