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First off I'm new to this board so I apologize if this question has been addressed ad nauseum but I just had my first child, a week ago, and this is the first that I've given it much consideration.

I'm an interested in investing the monetary gifts that he received in honor of his birth. I've looked at the College Savings Plans but am not sure that I fully understand the benefits. I am not overly interested in a prepaid tuition program at this point, I would prefer to just invest the cash and take my chances with regard to tuition if and when the time comes.

Accordingly, I am conisering either investing in one of the cash State Sponsored College Savings Plan or in a standard DRP account in a UGMA format. My state plan (PA) is not all that appealing to me so I am not (my belief) going to get any State Tax benefit from the College Savings Plan because I will most likely go out of State either Maine or New York(maybe). My parents are NY residents my inlaws are NJ residents (people likely to contribute other than my wife and I).

How are these plans better suited for saving for college than a standard DRP in say a rapidly appreciating stock with low or no dividends such as INTEL. I would not plan on liquidating the DRP investment unless the company I choose goes south (which I would not expect, but I say that to indicate that there probably will not be a capital gains concern until college (18 yrs. from now)). I don't expect contributions to be large maybe couple hundred dollars at a time, certainly no more than the $10,000 annual exclusion amount.

Anyone have any opinions on the relative strengths/weaknesses of these two options, or know of any good articles on the topic. I posted this on the Family Board and the Saving for College Board as well so execuse me if you see the post twice. Again I'm sorry if this has been addressed repeatedly.
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