College Savings Accounts

[88bmwjeff]

So, being a relatively new parent, I need to start saving for my son's college education. I'm curious what other parents are doing and where they have their (or their kid's money). Is a 529 Plan the best way to go, or are there better options?



Thanks

P.S. I'm in California, if that matters.

[UncleHowie]

Good for you, for thinking ahead.

I tried to get my sister to set up 529 plans for her two boys. We discussed the concept, benefits, and the fact that her two (educated, professional) siblings don't have kids (hint, hint!) Being a horse's hind end, she refused.

Long story short: her oldest (horrible student, no savings, plus no part-time job) is now in private college, amassing huge debt. Her youngest (started getting recruiting letters for academics as a HS sophomore) has no plans firmed up yet, and is in no hurry to do so. No support from his mother to try to make something of himself, and won't listen to his (educated, moderately successful) aunt or uncle for advice on his future.

It's really too bad, as both sets of grandparents and both my (other) sister and I would have contributed generously to a 529 or similar. I'm not going to give large amounts of cash to the boys to squander on beer and pizza. I've heard that's what some young folk will do, given the opportunity!

Anyway, do your research, set up a plan (or two), and see if relatives won't help kick in over the next decade or two...

Good luck!

[dancogan]

It is hard to go wrong with a 529 plan. There are websites that will compare the investment performance and investment choices available for each plan. You can invest in a 529 plan in any state, and the student can attend a school in any state. The 529 plan simply allows savings for education to be set aside and grow tax free, much like an IRA. However, when used for education, the funds come out tax free. I wish they had been available while we were saving for our kids' education!

Try here: http://www.savingforcollege.com/