I am trying to figure out how coordinate spending from a 529 and the various tax credits and deductions that are available. Does anyone have a good source that explains it all in one place and discusses strategies? Thanks.
Overall savingforcollege.com is the place.This is what I found with a quick search - http://www.savingforcollege.com/questions-answers/article.ph...
May i ask a related question?do I report 529, Educational IRA and custodial account as my assets or my son's assets on FAFSA?If this has been discussed before , sorry for asking again. I could not find itThank youusha
My understanding is that 529 plans depend on who owns it. If the student owns it, it is their asset, if the parent owns it, it is the parents assets. I think the student owns custodial accounts and it is recommended you spend them down before it is time to file the FAFSA. It should be spent legitimately, but if they need a computer for high school, or they are in summer camps, you can use the custodial money to pay for that. I have no idea about Educational IRAs. I don't have any sources for this information to give you, so don't rely on it without further research. If you find some concrete answers, let us know.
I think the student owns custodial accounts and it is recommended you spend them down before it is time to file the FAFSA.Heaven forbid you actually use the money to pay for college.
Thank you. How do i figure out who is the owner?
ushats: "Thank you. How do i figure out who is the owner?"Who opened the account? who receives the statements? And what do the statements state?Regards, JAFO
if they need a computer for high school, or they are in summer camps, you can use the custodial money to pay for that.My understanding is:1. 529 money cannot be spent until the student is in college2. even if the student is in college, 529 money cannot be spent on a computer unless the college requires that students have their own computersMaybe I misunderstood what is meant by "custodial money".http://www.savingforcollege.com/articles/avoid-these-529-wit...
Maybe I misunderstood what is meant by "custodial money".custodial money could mean 529 or UGMA/UTMA accounts.I think I usually have seen "custodial account" to mean the latter.There are 529s that are also UGMA/UTMA. Those have their own rules that if you're dealing with that, go read up on them.Spending down UGMA/UTMA accounts before filing FAFSA is generally good advice. They don't require you to spend the $ on college costs - but it does have to be legitimate needs/for the minor's benefit. http://collegesavings.about.com/od/ugmautmacustodialaccts/ss... Unlike what I gather from reallyalldone's response, I think the best thing to do is to try to maximize what can be gotten from financial aid legally. For example, it's a good idea to pull from a UGMA account to pay for DS/DD band trip their junior year instead of paying for it from my pocket, and then paying from my pocket for college tuition a year later instead of paying from their UGMA account. Sure it's not a big difference (20% of the money counted to family contribution if it's student's asset vs. 5.64% of the parents) But ~15% of $2K is $300 - which IMO makes doing that kind of shuffling worthwhile.
Thank you. I figured it by calling TDameritade.and in the account details clearly states my son is the owner.I also found out from reading at finaid.org that this is reported as his money.Thank you all.life long learner! always something new
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