Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next
Author: NaggingFool Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 8174  
Subject: Re: Invest for childs education? Date: 3/2/2004 1:15 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 1
A.) What do you think of 529 plans? Do you believe they are too restrictive in terms of what you can do with your money as opposed to the tax benefit.

I like them, and it's where I intend to put a big chunk of our college monies. We don't have kids yet, but I'm planning to open an account in my name now and start contributing (I've figured out that the chances of our having kids or my going to grad school approximate 100%.)

There is the concern that the tax advantage runs out in a few years, and who knows what Congress will do about it. However if you have a state tax advantage, I would say go for it.

B.) With or w/out a 529 plan, how would you allocate your investment of the $50K w/ an 18 year time horizon in from of you? (ie. index funds/ Stocks/ Bonds, Cash, etc.)

Personally we're putting all of our college funds in index funds and stocks, and will do so for at least the next ten years. One of the reasons I like the 529 plans current is that several of the respectable low fee funds have 100$ equity options, which are in index funds. I'm happy with the rule of thumb that says keep money in equities that you don't need for more than five years. However we are living well below our means, and can emotionally and financially weather a drop in the value of such funds.

If I were going to put money into cash or bonds I would not do so in the 529 plan as there would be little tax advantage to doing so (barring a rebate from the state).

- Megan
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (3) | Ignore Thread Prev | Next

Announcements

Paying For School Guide
Trying to Tackle Tuition? The Motley Fool's Guide to Paying for School will help you fight those rising education costs.
Pencils of Promise - Back to School Drive
"Pencils of Promise works with communities across the globe to build schools and create programs that provide education opportunities for children."
Managing Your Wealth
Our own TMFHockeypop from Rule Your Retirement fame on the TV show Managing Your Wealth.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement