So I know there are several parents now on TWW, including myself. My wife and I are searching for a college fund for Chandler. We want to make monthly deposits into the fund. Have you set one up for your kid? If so which one did you choose and why? Some helpful info here...

http://www.newyorklife.com/nyl/v/index.jsp?contentId=11796&vgnextoid=26a72f5a919d2210a2b3019d221024301cacRCRD

3/1/2011 8:36:30 AM

how old is your son? i thought it was just the two of you

3/1/2011 8:50:16 AM

he's 8...so basically i figure we have about 10 years to be ready.

3/1/2011 9:05:46 AM

this may be more appropriate for Old School

3/1/2011 9:31:33 AM

We currently just have a 529 plan for our first. Once the second one comes and life has stabilized we'll probably do something else too.
http://www.cfnc.org/save/save.jsp

3/1/2011 9:40:07 AM

well i'm wondering if a college fund is the best option. i know the 529 has some great tax incentives but what if, god forbid, chandler passes before he goes to college, or what if he turns into a fuck up and decides not to go to college? what happens to the money then. can we get a higher return with some sort of other investment or mutual fund that matures in 10 years and use the money for college at that time?

3/1/2011 10:13:47 AM

The plan can always be transferred to a different child/beneficiary if you had more than one (and I think even transferred to yourself for higher education).

Also:

Quote :

"The earnings portion of non-qualified withdrawals is taxed as ordinary income at the account owner's rates, plus a 10% tax penalty. If the beneficiary dies, becomes totally and permanently disabled, the 10% tax penalty is waived. If the beneficiary receives a scholarship, the 10% tax penalty is waived on distributions up to the amount of the scholarship. States may also assess their own penalties in addition to income tax on the earnings portion of the distribution. "

[Edited on March 1, 2011 at 10:17 AM. Reason : .]

3/1/2011 10:16:11 AM

nm

3/1/2011 10:24:08 AM

529 is the way to go.

3/1/2011 12:07:46 PM

cool...i was leaning towards that anyway

3/1/2011 12:27:25 PM

i'm just going to tell my kids to get good at sports

3/1/2011 5:07:36 PM

There's also the Indian College Fund (ICF) which entails forcing them to study during every waking hour that is not at school, accepting nothing less than straight As and threatening to disown your children should they fail to get a full ride to a college that will lead to a career as a doctor, engineer, or lawyers

This is also a prong of the Indian retirement plan (401i), whereby you have several kids who are doctors, engineers, or lawyers, and they support your ass during retirement.

[Edited on March 2, 2011 at 9:52 AM. Reason : .]

3/2/2011 9:50:51 AM

But seriously, we're saving what we can now. Praying he's tall and athletic.

3/2/2011 9:58:07 AM

if I can through school without any of my parents' financial aid, I don't think it would be unreasonable to expect my kids to do the same.

3/2/2011 10:31:39 AM

I don't think it's a foregone conclusion that loans, grants, and scholarships will be as readily available 15-20 years from now as they were when we were younger. It's already less available now than back in the 90's, and who knows what kind of financial situation the government and universities will be in then. I don't have a lot of faith.

even putting all that aside, my parents were dirt fucking poor, and we felt pretty good about having dinner every night. I'm more than financially solvent enough to sock a few bucks away a month in a 529. FOR THE KIDS MANG

[Edited on March 2, 2011 at 10:38 AM. Reason : .]

3/2/2011 10:37:33 AM

my wife's parents saved money from the time she was a toddler, and they were able to pay every cent of her undergrad and grad school. it's a pretty amazing gift to be able to start your adult life after college with no school debt, so i think we'll be doing this when we have kids

3/3/2011 7:42:19 AM

^same for my wife's parents. They started saving when she and her twin sister were babies and paid for both of their college degrees. Definitely an awesome gift for her/us. My parents didn't ever have much money so they didn't have much saved for college. They did offer to split my and my sister's college expenses with us which was still cool. Basically they are paying half of the loans for each of us which is pretty helpful as well.

We haven't decided what we want to do yet (no kids atm so we have time to plan still). Right now our plan is to save to make sure we can pay for at least 1/2 of college expenses straight out of something like a 529. But beyond that we'll see how things are going once we have kids.

[Edited on March 3, 2011 at 9:01 AM. Reason : .]

3/3/2011 9:00:29 AM

yeah, we opened a 529 as soon as we got our kid's SSN. Been putting away $50/month. we've already got enough for a year of state tuition haha.

3/3/2011 10:09:58 AM

well this is my deal. chandler's biological father died last august. he was involved in a car wreck while delivering a package for work, so there was a workman's comp claim filed for his kids. chandler will be receiving $680 a month which we are planning to put into an account to invest into his future. basically like a trust fund. we are just trying to figure out the best way to invest it. by the time he's 18 he'll have over $100k to use for college and other expenses.

3/4/2011 10:35:06 AM

I think with that level of income I'd talk to a financial advisor about additional investments. You only get 2500 (5000 married) tax break on it with a 529 per year anyway.

[Edited on March 4, 2011 at 11:33 AM. Reason : 529]

3/4/2011 11:32:31 AM

^Talk about a silver lining. Unless the biological father really sucked...then it's just an overall great thing.

I've said that my parent's first divorce was just an overall great thing. I got rid of a shitty dad, my mom was finally happy, and I got my college education paid for!! HOLLA!

3/4/2011 11:34:07 AM

he was a shitty dad for 6 years. he got his shit together and started doing the right thing and 6 months later died. karma is a bitch.

talked to a financial advisor today. going to invest in a mix of 529, UTMA and, damn forget the name of the other account...something like parent investment account or something.

3/4/2011 3:49:59 PM

I would definitely put that money in a trust fund for him. My inlaws did this for their kids and it has worked out great. They get a 3rd at age 25, a 3rd at age 30 and then the rest at 35. This way they can't blow it all the first year they get it.

3/5/2011 8:53:59 PM

^If I have kids, I will do something like that....if not, then I will still do something like that for whoever gets my $$$$. I am probably going to change it down the road because other than one nephew, the other two nieces and nephew have rich parents so I will probably end up if I do not have kids Willing it to Make A Wish......or something like that....

[Edited on March 5, 2011 at 9:32 PM. Reason : q]

3/5/2011 9:31:48 PM

when we have kids we will def. get a 529.

What is the most you can put into a 529 a month?

3/6/2011 9:41:06 PM

5 posts up.

3/6/2011 9:45:57 PM

Since my wife and daughter are British citizens, we started putting GBP 100/month (max allowed) into the Child Trust Fund, a governmental scheme, since she turned 3 months (TODAY she turned 2 years ). No one can touch the money (not even us) except for our daughter and only when she turns 18 (plan ends then). The parents can choose the plan they want. There are 3, basically, an aggressive one (all stocks), a medium risk one (stocks and bonds), and a low risk one (bonds and cash). The scheme is tax-exempt, as the government makes enough from investing parents' contributions to make a fat profit for themselves.

We chose the medium one, and the expected value of it when she turns 18 is about GBP 30k-40k (total paid by then would be just under GBP 22k)

[Edited on March 7, 2011 at 8:49 AM. Reason : http://www.childtrustfund.gov.uk]

3/7/2011 8:47:39 AM

^^you can put as much as you want (up to 500000 total if I remember correctly) in a 529, but you only get 2500/5000 toward a tax break.

3/7/2011 9:29:47 AM

^^I thought education is free in European countries. At least I thought it is due to the high taxes there.

3/7/2011 10:19:01 AM

I think that applies to mainland Europe.

In the UK, it is [mostly] free in public unis, and not free in private ones, just as in the US. Who knows where she will go after HS. She might end up studying in the US, or in a private uni in the UK. She might go to Japan... who knows! Even if we knew for certain that her education would be free, that bit of money is still good to have for her to establish herself after finishing HS (rent, car, or even grad school or a traveling scholar of some kind).

Quote :

"There's also the Indian College Fund (ICF) which entails forcing them to study during every waking hour that is not at school, accepting nothing less than straight As and threatening to disown your children should they fail to get a full ride to a college that will lead to a career as a doctor, engineer, or lawyers This is also a prong of the Indian retirement plan (401i), whereby you have several kids who are doctors, engineers, or lawyers, and they support your ass during retirement."

Hahahahahahahah... I definitely had to go through the first one. Thankfully not the 2nd one, as my parents have saved enough for retirement.


[Edited on March 7, 2011 at 2:15 PM. Reason : ]

3/7/2011 2:13:28 PM

I would have a fund but keep it secret from the child until they go to college. Before that time, impress upon them how much hard work it's going to take to go to college and pay for it because they aren't getting shit from you.

3/7/2011 6:13:09 PM

Oh definitely, I won't be telling my kids about any of the college money we save

3/7/2011 9:16:30 PM

^^ Of course, that's a given.

3/8/2011 7:31:30 AM

Quote :

"There's also the Indian College Fund (ICF) which entails forcing them to study during every waking hour that is not at school, accepting nothing less than straight As and threatening to disown your children should they fail to get a full ride to a college that will lead to a career as a doctor, engineer, or lawyers This is also a prong of the Indian retirement plan (401i), whereby you have several kids who are doctors, engineers, or lawyers, and they support your ass during retirement. "

hahahaha

3/8/2011 4:05:32 PM

^^,^^^,^^^^I think it makes sense to not talk a whole lot about what you've saved for your child's college with your child.

But I don't think it's a good idea to lie and make a big deal about how they're going to have to pay for it all themselves. That seems like one way to get them to work hard for a scholarship. Or work so hard that they crack under the pressure. Or write off the idea of college altogether since they can't fathom getting a scholarship or taking out loans.

[Edited on March 8, 2011 at 7:51 PM. Reason : ]

3/8/2011 7:51:04 PM

I suppose, but it worked alright me for. My parents actually didn't have anything saved because they don't make much so I knew all along I would have to get some scholarships and take on most or all of the loans. (They ended up helping me with loans more than I thought they would in the end, taking on half).

3/8/2011 10:34:53 PM

Yeah, and I was thinking that you'd definitely have to tell them something. Like what if they're thinking about schools based on what's the best value or what they can get the best scholarship for--and not program quality or school culture? There could be a bunch of great schools that they look over because they're out-of-state or private. And if they end up at a school they dislike because of that, that's bad news. I mean, you're saving money for them to go to college, which opens up so many options and opportunities for them--it'd be crazy to limit their sense of options and opportunity by being coy about the process...especially when the options/opportunities is why you saved all the money in the first place.


Plus,, there are other ways to get kids to work hard in school than acting like they have to get scholarships/loans if they want to go to college.

[Edited on March 9, 2011 at 4:00 AM. Reason : ]

3/9/2011 3:58:04 AM

oh definitely. There will have to be some sort of compromise there. I just don't want my future kids knowing their entire life that their college tuition is already mostly or all covered. I will probably let them know that we will be able to cover "some" of their tuition but still encourage that scholarships can open doors to schools that might have previously been out of our price range etc. And also, I do think just being actively involved in the kids' learning is almost more important than telling them to work hard to get scholarships. I think half the reason I did well in school was due to the fact that my parents showed an interest in everything I worked on in school. They didn't do any of my assignments or anything like that, but they did ask questions and proof the work now and then. They knew exactly what we were covering in my classes and helped me study etc. Definitely makes it harder to slack off

3/9/2011 8:00:04 AM