529's

NEW -> Contingent Buyer Assistance Program
tmare_IHB

tmare_IHB

New member
How are those of you who set these up for their kid's college education feeling about them now? I started with $10K and have put $400 a month in ever since (a few years ago). The accounts are now worth less than I put in. Should I continue? Some advice says yes in order to buy cheap (?). Should I pull it all or leave it? I just didn't find any other tax free way of saving at the time I opened these accounts, but now I think I should consider something else. I've been considering just discontinuing any further deposits. Advice anyone?
 
[quote author="24inIrvine" date=1229517861]I don't really have any advice, but I think one question many will ask is "how far are your kids from college? how old are they?"</blockquote>


Yes, I guess I did forget that, they are 3 and 4 years old. How about advice now?
 
[quote author="tmare" date=1229519073][quote author="24inIrvine" date=1229517861]I don't really have any advice, but I think one question many will ask is "how far are your kids from college? how old are they?"</blockquote>


Yes, I guess I did forget that, they are 3 and 4 years old. How about advice now?</blockquote>


Keep on slamming those deposits in and keep averaging down... I am continue to do $200 per month per kid. I did rebalance into a more conservative investment option and allocation earlier this year to preserve capital. It's probably about time to move back into more aggressive equity investment options there I'd think.



I love my <a href="http://personal.fidelity.com/products/checking/content/529_card.shtml.cvsr">Fidelity 529 card</a> and its free contributions. I have a Mastercard that they no longer offer that gives 2% toward 529 with a $1500 annual limit. I usually hit that cap in 8-9 months and shift all my charges over the 529 Amex until the Mastercard kicks back in with rewards.
 
I 2nd that card. If I had kids, that would be the first card i'd use. I already suggested it to my sister and her husband who are expecting there first child.



But now that you stated the age. I would also keep pumping the equities, 15 years is a long time that you have to beat inflation. Maybe you should PM blackvault :)
 
Yep! I do the same with Fidelity's card. I do not have children, but one account is going to my nephew (the only child of the entire family...). Ohh, he is 4 months old, I just started the account with 50k and just maximize in just under 12 months. Anyways good luck

-bix
 
[quote author="biscuitninja" date=1229560771]Yep! I do the same with Fidelity's card. I do not have children, but one account is going to my nephew (the only child of the entire family...). Ohh, he is 4 months old, I just started the account with 50k and just maximize in just under 12 months. Anyways good luck

-bix</blockquote>


Aren't you concerned with what happens if he ends up the only child in the family and decides not to go to college or can't use the total amount, I know college costs will go up, but what if it's too much?
 
[quote author="tmare" date=1229560946][quote author="biscuitninja" date=1229560771]Yep! I do the same with Fidelity's card. I do not have children, but one account is going to my nephew (the only child of the entire family...). Ohh, he is 4 months old, I just started the account with 50k and just maximize in just under 12 months. Anyways good luck

-bix</blockquote>


Aren't you concerned with what happens if he ends up the only child in the family and decides not to go to college or can't use the total amount, I know college costs will go up, but what if it's too much?</blockquote>


Great question. The money can be transferred to an IRA or if you are over the age of 67 you can pull it as a regular IRA. PLUS you could also use it yourself. Since I'm doing my Phd I could use it AND in a pinch you give it over as a scholorship.



Anyways good luck

-bix
 
[quote author="tmare" date=1229560946][quote author="biscuitninja" date=1229560771]Yep! I do the same with Fidelity's card. I do not have children, but one account is going to my nephew (the only child of the entire family...). Ohh, he is 4 months old, I just started the account with 50k and just maximize in just under 12 months. Anyways good luck

-bix</blockquote>


Aren't you concerned with what happens if he ends up the only child in the family and decides not to go to college or can't use the total amount, I know college costs will go up, but what if it's too much?</blockquote>


Remember, the 529 account is owned by the account holder, not the potential student beneficiary. You can change beneficiaries, take the money back to buy a boat, etc.
 
[quote author="ipoplaya" date=1229564974][quote author="tmare" date=1229560946][quote author="biscuitninja" date=1229560771]Yep! I do the same with Fidelity's card. I do not have children, but one account is going to my nephew (the only child of the entire family...). Ohh, he is 4 months old, I just started the account with 50k and just maximize in just under 12 months. Anyways good luck

-bix</blockquote>


Aren't you concerned with what happens if he ends up the only child in the family and decides not to go to college or can't use the total amount, I know college costs will go up, but what if it's too much?</blockquote>


Remember, the 529 account is owned by the account holder, not the potential student beneficiary. You can change beneficiaries, take the money back to buy a boat, etc.</blockquote>


I was under the impression (no, I was told by the man who opened this account for me at the bank), that if the money wasn't used for someone's qualifying education expenses, it would all be taxable.
 
[quote author="tmare" date=1229572828]



I was under the impression (no, I was told by the man who opened this account for me at the bank), that if the money wasn't used for someone's qualifying education expenses, it would all be taxable.</blockquote>


The gains would be taxable if not used for qualifying education expenses, not the contributions. Contributions made with after-tax dollars don't get re-taxed, just the return they produced does. Using those funds down the line for non-education expenses is similar to putting the money into a savings account and deferring taxes on the earnings until way later.
 
Thanks for all of the responses, I feel better about continuing the same path. Wouldn't mind seeing some gains soon though.
 
All this talk about 529's reminded me that it is almost time to make the annual $2K contribution to the Coverdell IRAs as well... Sadly the one I established in 2004 for my oldest is worth $9,990 today and I have contributed $10K so far.
 
[quote author="ipoplaya" date=1229601503]All this talk about 529's reminded me that it is almost time to make the annual $2K contribution to the Coverdell IRAs as well... Sadly the one I established in 2004 for my oldest is worth $9,990 today and I have contributed $10K so far.</blockquote>


I'm right there with 'ya, it is sad.
 
[quote author="tmare" date=1229601890][quote author="ipoplaya" date=1229601503]All this talk about 529's reminded me that it is almost time to make the annual $2K contribution to the Coverdell IRAs as well... Sadly the one I established in 2004 for my oldest is worth $9,990 today and I have contributed $10K so far.</blockquote>


I'm right there with 'ya, it is sad.</blockquote>


Yup
 
[quote author="tmare" date=1229601890][quote author="ipoplaya" date=1229601503]All this talk about 529's reminded me that it is almost time to make the annual $2K contribution to the Coverdell IRAs as well... Sadly the one I established in 2004 for my oldest is worth $9,990 today and I have contributed $10K so far.</blockquote>


I'm right there with 'ya, it is sad.</blockquote>
I went SUPER stable with my 529's So far i'm +2.5% woot! Big Money!!!



:lol:



-bix
 
You must log in or register to reply here.
Back
Top