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Author: 2laz2p Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 8203  
Subject: savings bonds Date: 9/29/1998 9:40 PM
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We purchased 100 dollar series e bonds from 1982 to 1988 for our daughter and 100 for our son from 1984 to 1990. bonds are in their names. Daughter will be 17 in november. We have been thinking about redeeming them before they are counted against her for school. She is a junior in HS. Is it too late to reinvest in better return? or should we simply join procrastinators anonymous. Our household income is about 90,000/yr but payments are tough. PS: We bought 1 bond per month for 6 years for each. Savings bond Wizard says hers are worth aobut $8100.

Would certainly appreciate any advice.

Mange Tak
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Author: RecoveringFool Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 229 of 8203
Subject: Re: savings bonds Date: 9/29/1998 10:00 PM
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<<We purchased 100 dollar series e bonds from 1982 to 1988 for our daughter and 100 for our son from 1984 to 1990. bonds are in their names. Daughter will be 17 in november. We have been thinking about redeeming them before they are counted against her for school. She is a junior in HS. Is it too late to reinvest in better return? or should we simply join procrastinators
anonymous. Our household income is about 90,000/yr but payments are tough. PS: We bought 1 bond per month for 6 years for each. Savings bond Wizard says hers are worth aobut $8100.>>

You have lots of issues here. This is all my opinion and you may get others. For your daughter, it's too late to do anything but move them to a CD or money market fund. You need the money in less than 2 years. You can't simply cash them in - the money has to be used for something you normally wouldn't provide. Did you save this money to help pay for college ? Why don't you want to use it for college ? There are very few full ride scholarships out there and they're usually based on merit anyway. You should go to www.finaid.org and use the EFC calculator(Expected Family Contribution). For a family of 4 with a 90K income, it doesn't much matter what your payments are, it is doubtful you qualify for much financial aid. You will still have the Hope Tax credit - probably depending on the income adjustments in the next 2 years. Probably not what you wanted to hear. Look around NOW because there was at least one scholarship that my daughter had to apply for her junior year. Also, make sure your daughter takes the PSAT because it's the qualifying test for the National Merit Scholarship program. Good luck !

Jacki
AKA RF

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Author: dennisthefool Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 233 of 8203
Subject: Re: savings bonds Date: 10/1/1998 3:20 PM
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I'm not sure why you think cashing them in would mean they wouldn't be counted for financial aid. Whether in CDs stocks bonds or tens and twenties, they're still assets and have to be listed on the form. Of course if you just give her the dough and let her take a trip to Bermuda, it won't be an asset, but she'll have 8000 bucks less for college (and think what else you'll be teaching her).

dennis

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Author: 2laz2p Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 235 of 8203
Subject: Re: savings bonds Date: 10/2/1998 11:06 PM
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I certainly understand what you are saying, however the idea is not to take away her education money but rather to move it back into our name and retain control. Our understanding is that the less assets are in her name the greater the likelihood of some form of assistance. At the same time we may be able to generate slightly higher return than the Series E bonds are generating.

Thanks

jc

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Author: TchrP Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 236 of 8203
Subject: Re: savings bonds Date: 10/3/1998 1:18 PM
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>> I certainly understand what you are saying, however the idea is not to take away her education money but rather to move it back into our name and retain control.
-----------------

I strongly advise you to consult a lawyer.

In general: once you have placed assets in a child's name, you cannot take them back. In giving an asset to your child, you assumed a legal role as the custodian of the funds, and you can only use the funds for the child's direct benefit. Cashing bonds and transferring the proceeds to yourself is the legal equivalent of stealing.

What you can do, however, is use the proceeds (still in a custodial account) for expenses that benefit the child but which aren't consider basic, fundamental responsibilities of parents. For example, you can't withdraw funds for the child's food or clothing, but you could withdraw them for "extras" such as music lessons, summer camp, or private school. If you have expenses in a category like this that you would ordinarily pay out of your own pocket, you could pay them from the child's funds instead and set aside the equivalent (in your own name) toward tuition.


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Author: mlkeen Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 239 of 8203
Subject: Re: savings bonds Date: 10/4/1998 6:21 PM
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While transfers can be made to cover "camp" etc., it is my understanding that financial information is required for up to four years prior to applying for aid.

Basically colleges are wise to the transfers.

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