Does anyone have a 529 College Savings account?

819 Views 21 Replies 18 Participants Last post by ju-cee, Apr 23, 2006

elight23

Discussion Starter · Mar 27, 2006

Does anyone have a 529 College Savings account? If so, which state did you decide to go with and why?
Any recomendations?
TIA

1 - 20 of 22 Posts

earthmama369

· #2 · Mar 27, 2006

Yes, but to be honest, my parents opened it for dd and put money in every Christmas and birthday and just write a note in a card telling us how much they put in. Other family members who want to contribute know to deal with my mom -- she's the family financial wizard. I have no idea which state they went with, what the account number is, etc.

: Mom gave me a printout just after dd was born with the account information, and since we moved I haven't seen it. It's around here somewhere. . . .

*bump* I'm curious to see what other people have chosen and why. I really need to learn more about money beyond having a savings account at our local bank.

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MamaMonica

· #3 · Mar 27, 2006

We use general 529s through Fidelity. The plan is adjusted by age how the money is invested- ei- riskier for more growth at the beginning and more conservatively as the college years approach. They do this automatically so we don't have to manage it.

bu's mama

· #4 · Mar 27, 2006

I have one for dd that I do automatic deductions from my checking every month. It's not much, but it's a start. I have mine with NY, it's well rated but also where I live.

There is a good comparison of plans out there on the web somewhere...maybe google something like "529 state comparison"

There were some issues about private companies selling the same plans as the state government, but attaching their fees, so it will save you a bit to deal directly with the state.

TiredX2

· #5 · Mar 27, 2006

Quote:

Originally Posted by MamaMonica
We use general 529s through Fidelity. The plan is adjusted by age how the money is invested- ei- riskier for more growth at the beginning and more conservatively as the college years approach. They do this automatically so we don't have to manage it.

That is also what we do. Looking around, the plan we are in (New Hampshire, if I remember correctly) is honestly not the best choice but I am really stuck with the convenience of it. I know logically, I should pick one that would be better financially, because that 1% difference in return yearly is going to be big after 18 years, but

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Livi's Mama

· #6 · Mar 27, 2006

we have plans thru wisconsin. there are many investment options. I honestly don't know how the performance compares w/others. we can use the money in any state & since we live in WI, we can write off our investment from our state taxes, so we come out ahead, I expect. We do the monthly withdrawal from checking, also. (I'd be lost w/o it!)

Stella_luna

· #7 · Mar 27, 2006

Check out savingforcollege.com . . . so much good advice (I have the PA TAP, but it's only for PA residents, so I can't help . . . )

M&Mmama

· #8 · Mar 27, 2006

We have two accounts (you can have them in more than one state). Since we live in Minnesota and they having a small matching grant program, we contribute to that to get their additional contribution. Theirs is run by TIAA-CREF which is pretty good, low fees, good solid reputation.

But an even better one in terms of the company that manages it is Utah which is run by Vanguard, the low fee leader in the industry. They have great options for age-based allocations but also you choose whether you want conservative, aggressive or somewhere in the middle. I would highly recommend this.

However, don't forgot to fund your retirement fully first. Your kids can borrow for college (or you could on their behalf) but you don't want to shortchange yourself for retirement. I tend to get more focused on the kids' needs and minimize our own, so that's why I mention it.

Good luck.

BookGoddess

· #9 · Mar 27, 2006

We have a 529 plan for DD. We opened with a generous contribution from my parents. Now, we have a monthly automatic deduction taken from our checking account. We didn't go with ou4 home state (Hawaii) because 1) we didn't care so much for the fund choices and 2) we don't get any state tax benefit at all. We went with the Vanguard plans available in Iowa. There's no annual maintenace fee and no enrollment fee.

When you're searching for a fund first see if your state plan gives you any state benefits. You also need to see who runs the fund, what the returns are, what the investing options are, and what the annual maintenance/sales commission are.

You might also want to look into UPromise. There's a website for it. It's helpful when you're saving for baby's college education.

Good luck!

BookGoddess

· #10 · Mar 27, 2006

We have a 529 plan for DD. We opened with a generous contribution from my parents. Now, we have a monthly automatic deduction taken from our checking account. We didn't go with our home state (Hawaii) because 1) we didn't care so much for the fund choices and 2) we don't get any state tax benefit at all. We went with the Vanguard plans available in Iowa. There's no annual maintenace fee and no enrollment fee.

When you're searching for a fund first see if your state plan gives you any state benefits. You also need to see who runs the fund, what the returns are, what the investing options are, and what the annual maintenance/sales commission are.

You might also want to look into UPromise. There's a website for it. It's helpful when you're saving for baby's college education.

Good luck!

BookGoddess

· #11 · Mar 27, 2006

Whoa! Double post. Sorry!

Glover_Girls

· #12 · Mar 27, 2006

I have a 529 account for my DD linked to a UPromise account. Basically, if you shop on line (and I do) and you access the websites via UPromise first, then your account is credited a certain percent of your purchase. For example, if you shop at Leaps & Bounds, your UPromise account will get 4% of the purchase total. Every quarter, they transfer your UPromise amount (in increments of $50 I think) into your 529. It's awesome!

I've had a couple hundred dollars transferred just last year. I did most of my Christmas shopping on line. There are so many companies listed as UPromise partners. Additionally, many items you may (or may not) purchase from the grocery store are partners so you earn $$ when you purchase those items.

It's free money and the way I look at it, I might as well take advantage of it if I'm already shopping at these places and earn a few bucks for my DD's college fund. Oh-and you can ask your family members to also register and haver their purchases go toward your 529. I also have a monthly transfer from my bank account into the 529.

www.upromise.com

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elight23

Discussion Starter · #13 · Mar 28, 2006

Thanks for all of the advice.
As far as the UPromise account, isn't that .65% annual fee a substantial amount? $20 plus .65% sounds pretty high to me. That's like, $325 a year on 50k - super high, unless I'm not understanding what they ment.

mnnice

· #14 · Mar 28, 2006

The fees on upromise are high. We had one and we rolled it over into our states plan (if forget who the plan administrator is-it is a familiar big name). It was fine for the year I bought a new GM car because that alone was like a $75 credit, but in the end it seemed like trick to make you charge more.

The4OfUs

· #15 · Mar 28, 2006

You can still use UPromise even if you don't have a linked account. We have a NY State 529 through the same company DH has his IRA (not linked to UPromise), and we have a UPromise account. Whenever the UPromise balance gets over $100, we just write them a letter asking them to cut us a check for the balance and mail it to us; there's no charge for that service.

We figure at the very least, the UPromise money we're getting is covering the 529's admin fees every year (which fortunately, aren't very high) - plus, we can deduct our 529 contributions on our NY taxes. When we bought our home last year, the real estate agency participated in UP, and we got $300 from the house purchase deposited into our UPromise account!!!!

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Ellien C

· #16 · Mar 29, 2006

I just went with my home state which offers a small tax advantage because it was easy and DH was procrastinating. We might have been able to shop around and find a better deal that would offset any tax advantage we'd lose, but that was going to take another 2 years so I went ahead and opened a home state 529.

bu's mama

· #17 · Mar 29, 2006

I'm in the middle of my computer class right now

& don't have much time to post, but I just wanted to throw this out there...

I was reading something today about Coverdale accounts & how they are advantageous because they can be used for private high schools, trade/vocational schools, etc.

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SleeplessMommy

· #18 · Mar 29, 2006

We have our 529 through Vanguard. Great web site interface, low fees. I likeVanguard a lot.

Also, I second the suggestion abbout the Upromise card. My DH travels for work, and puts expenses on the Upromise card. We get $500 or so every year from Upromise for the 529. This is a LOT of $$$ when you factor in the compounded interest for 18 years.

anthasam

· #19 · Mar 30, 2006

Quote:

Originally Posted by SleeplessMommy
We have our 529 through Vanguard. Great web site interface, low fees. I likeVanguard a lot.

Also, I second the suggestion abbout the Upromise card. My DH travels for work, and puts expenses on the Upromise card. We get $500 or so every year from Upromise for the 529. This is a LOT of $$$ when you factor in the compounded interest for 18 years.

Same here. We went with Vanguard and have a Upromise Mastercard. DH does his work expenses on the Upromise card too. Free money for college is great

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magpie mamma

· #20 · Mar 31, 2006

Thanks for all the great information, I have been wondering about rates and which states were better.

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