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I set up a UGMA for my infant son in 1987 for college savings. I purchased three stocks (after the crash) with DRIP's and they have grown substantially. It was my only good lifetime investment. He's got more money saved than I do. Now I find out that college savings should not be in UGMA's since they reduce the amount you could receive in college aid. Something like 35% of the childs assets are considered elegible for college expenses compared to 5% of the parents. I plan on selling the stocks in 2001 to take advantage of the 5 year holding rule and therefore 8% capital gains rate. Can I just take the proceeds and put the cash in my bank account and use it for tuition?
Anyone who has been through this before please feel free to comment.
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