How much is enough in the 529 accounts?

Wife and I are contributing to both kids up to the annual state deduction limit.

I think we will likely back off/stop during high school. It'll mostly depend on how much they have and whether it appears they will be smart or not

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would give us ~$75k

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That's about what I estimated as well. We spend roughly $14k/year on each kid's tuition, summer camps, aftercare, etc and that money could just be put towards college as well. I'm not sure I'll need the full $75k when my kids reach college. If I knew TOPS would still be a thing in 12-13 years, then I certainly wouldn't need it. I'm just thinking that at some point I might be better off sticking the money elsewhere.

I'll have about $55K for each child (2) when they go to college so whatever is in there is what they will get. If that's not enough they better keep studying hard for scholarships or take out a loan if they want to go to a more expensive school. I'm maxing out my retirement accounts. That's more important than saving $100K for each kid for college when there's tons of money out there to help. I'm hoping that I won't have to use any of that money and they get full rides somewhere.

Our goal was 100k for both kids when they were born. We reached that level and with growth we had @127k when the first went to college last year. She decided to go out of state and we believe we have enough with scholarship $$ to cover the 4 years.

If you stay in state and tops doesn’t change we estimated that 60 to 80k would be the number.

My daughter has a loan at 1.5%, anything can happen so don’t oversave in 529, just do enough that it takes the impact away when they go.

Biden going to give you some free too....

I use a UTMA. It does not get the tax advantages or match as a 529, but you can use it on anything relating to the child. Also, the interest is taxed at the child's tax rate. Right now we use it as a savings for college as well as to cover next year's tuition. When the bill comes, we just request that amount to come out. I would like to be able to foot 6 years of college as I think grad school will be necessary, but I am also not trying to kill myself and sacrifice living life for the sake of possibly needing the funds for college.

You can use these funds on anything for the child, tuition, meals, clothes, car, room & board...

Down side to the UTMA, control turns over to the child at 18 (some States it is 21), so it will become their money and can blow it how they want. When in HS we will try to teach them about the value of not blowing the funds on top end cars, hookers & blow, stupid tech... basically the shite we did

My son(14) started getting about $1,100 per month in Social Security last year. I just transfer the exact amount into the plan. I figure it will be a great start even if it's not enough.

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My son(14) started getting about $1,100 per month in Social Security last year.

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why does he need college if he’s already retired ?

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why does he need college if he’s already retired ?

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He's in 9th grade.

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I use a UTMA. It does not get the tax advantages or match as a 529, but you can use it on anything relating to the child. Also, the interest is taxed at the child's tax rate. Right now we use it as a savings for college as well as to cover next year's tuition. When the bill comes, we just request that amount to come out. I would like to be able to foot 6 years of college as I think grad school will be necessary, but I am also not trying to kill myself and sacrifice living life for the sake of possibly needing the funds for college.

You can use these funds on anything for the child, tuition, meals, clothes, car, room & board...

Down side to the UTMA, control turns over to the child at 18 (some States it is 21), so it will become their money and can blow it how they want. When in HS we will try to teach them about the value of not blowing the funds on top end cars, hookers & blow, stupid tech... basically the shite we did

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With the exception of a car, every expense you mentioned can be paid using 529 assets tax free.

Also, while the first $1,100 of earnings in a UTMA is actually tax free, and next $1,100 is taxed at the child’s tax rate (Kiddie Tax), any earnings above that are taxed at the parent’s income tax rate.

Additionally, for the purpose of calculating expected financial contribution, and subsequently need based financial aid, UTMA assets are considered assets of the child, and up to 35% of those assets can be included in the expected contribution formula. 529 assets on the other hand, are considered assets of the parent, and are included at a max rate of 5.6%.

Finally, the ”beneficiary” on a UTMA account cannot be changed, because the assets actually belong to the minor. On the other hand, if you have excess funds in one child’s 529 account, you may change the beneficiary of those funds to another child or relative at any time.

The only pro I can think of for a UTMA vs a 529 account is a wider range of investment options in a UTMA, but there are 529 providers with low cost etfs on their platforms these days.

When saving for educational expenses, UTMA accounts are inferior in almost every way to 529 plans.