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I want to set up Education IRA's for my kids but I'm not sure of the correct path. Is this similar to a regular/Roth IRA, where I could do a self-directed type thing at a discount broker? If so, I assume I would just contact them, tell them I want to establish an Education IRA account, shuffle the appropriate paperwork, then pick the stocks?

Any info would be appreciated.

Thanks,

Tim

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Tim, you asked:

I want to set up Education IRA's for my kids but I'm not sure of the correct path. Is this similar to a regular/Roth IRA, where I could do a self-directed type thing at a discount broker? If so, I assume I would just contact them, tell them I want to establish an Education IRA account, shuffle the appropriate paperwork, then pick the stocks?

See my Foolish Retirement Plan Primer at http://www.fool.com/retirement for some info on EIRAs. The $500 limit per child per year means not many brokers will handle these IRAs. Nevertheless, for those who do there is no reason at all that they can't be established as a self-directed account. Like you said, it's just a matter of contacting the broker to set up the accounts for each child.

Regards….Pixy

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Tim: The Education IRA idea sounds good at first, but if you read the full disclosure you'll see that some other new benefits (HOPE Scholarship Credit & Lifetime Learning Credit) may be more beneficial to the parent than using the distribution of an Ed/IRA... In order to preserve the right to use the two new tax credits & still withdraw from a funding source I prefer to use a Roth/IRA or even a traditional IRA! But do read the rules completely before making a decision. Best wishes. PP
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