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Savings Account Setup for Infant
Posted on 11/28/16 at 4:52 pm
Posted on 11/28/16 at 4:52 pm
We recently had our first child and with this birth have been a few small monetary gifts for her. Currently have them parked in a savings account for her but I'd expect these gifts to continue with each holiday, birthday, etc.
Should we be looking at other options for this money? It'll ultimately be used for educational related expenses, but I want to make sure it's setup for the best scenario for her long-term as well. 529? Roth? Keep it in traditional savings?
Thanks.
Should we be looking at other options for this money? It'll ultimately be used for educational related expenses, but I want to make sure it's setup for the best scenario for her long-term as well. 529? Roth? Keep it in traditional savings?
Thanks.
This post was edited on 11/28/16 at 4:55 pm
7
Posted on 11/28/16 at 5:01 pm to Golfer
Can't really help but congrats!!!
(This does make me think of the poster who said that his dad took his money that he got in this way ... please don't do that! Keep it for the kid!)
(This does make me think of the poster who said that his dad took his money that he got in this way ... please don't do that! Keep it for the kid!)
Posted on 11/28/16 at 5:56 pm to Golfer
Someone correct me if i'm wrong, but i think to go into a Roth, it has to be earned income by that individual. I'm putting peanuts aside into a 529 for the kids that will hopefully give them $20-25k once they graduate high school, but i don't consider myself rich so there are probably better options for savings that i'm not aware of.
I also have a stock account where i keep some dividend paying stocks, but it's in my name and i could see it providing a nice graduation gift or something in 20 years. We put all birthday/Christmas gifts into the 529 for each kid.
Eta congrats! Enjoy the ride!
I also have a stock account where i keep some dividend paying stocks, but it's in my name and i could see it providing a nice graduation gift or something in 20 years. We put all birthday/Christmas gifts into the 529 for each kid.
Eta congrats! Enjoy the ride!
This post was edited on 11/28/16 at 5:57 pm
Posted on 11/28/16 at 6:37 pm to Boh
My parents had life insurance policies on us and they accumulated as nice cash value. Don't even know if insurance companies even write policies like this anymore...we did similar for our children and turned the policies over to them to do as they wished. Parents had, as do we, stocks set aside for them as well....those which pay dividends.
Congratulations...enjoy the ride
Congratulations...enjoy the ride
This post was edited on 11/28/16 at 6:53 pm
Posted on 11/28/16 at 6:49 pm to wfallstiger
Northwestern mutual. Just bound for my second kid today
Posted on 11/28/16 at 8:59 pm to Boh
Thanks. Looks like I'll just setup a 529 plan for her. 
Posted on 11/28/16 at 9:09 pm to Golfer
Not sure where you live, but if your state doesn't provide tax incentives for 529 contributions you may be better off going with another state's 529 program.
Also most 529 programs these days allow people to deposit gifts directly in to the account, so that they don't need to give you cash or checks.
Also most 529 programs these days allow people to deposit gifts directly in to the account, so that they don't need to give you cash or checks.
Posted on 11/28/16 at 9:34 pm to TheChosenOne
quote:
Also most 529 programs these days allow people to deposit gifts directly in to the account, so that they don't need to give you cash or checks.
More convenient for me to do it than explain to some of them 1. What a 529 plan is, 2. How to electronically transfer money.
Posted on 11/28/16 at 9:34 pm to TheChosenOne
I haven't kept up with it but now a days what is considered the state with the best 529 plan? I live in Louisiana.
Posted on 11/29/16 at 7:05 am to LSUDbrous90
I believe that you get a tax incentive if you live in LA by contributing to their 529. I live in TX so there is no tax benefit. We've used the Ohio plan for one kid and NY plan for the other two. We chose the Ohio one at the time because that child was older and it had a really good bond fund. The other two children are younger and the NY plan had low fees and really great performance. If I recall, the Utah plan is another top performer. We googled the best plans, got a list by cross referencing different sites and used a free trial of Morningstar to help pick the best one for us. The downside is that you can make changes only once per year, so if your funds start doing bad, you may be stuck for a little while. Good luck.
Posted on 11/29/16 at 9:38 am to Golfer
quote:
Thanks. Looks like I'll just setup a 529 plan for her.
i started aggressive BlackRock 529 plans for my 2 and 3 year olds in 2014 & 2015
This post was edited on 11/29/16 at 9:39 am
Posted on 11/29/16 at 9:48 am to Golfer
529s can only be used for college. If you plan on sending to private school and using the money to help with private school tuition, then consider an UGMA (Unified gifts to minor) account.
Posted on 11/29/16 at 9:49 am to bnb9433
How about the Louisiana START program? The state will match your contributions up to a small percent, and you decide how risky you want to be. To be used for college expenses and can be used out of state.
Posted on 11/29/16 at 10:53 am to Motorboat
quote:
If you plan on sending to private school and using the money to help with private school tuition, then consider an UGMA (Unified gifts to minor) account.
Could you go into more detail about this? Essentially they are just custodial investment accounts for the minor, right?
This post was edited on 11/29/16 at 10:54 am
Posted on 11/29/16 at 1:39 pm to Golfer
Slight hijack/spinoff...
If I want to give some money as a gift that would go to a 529 (or similar), should I write the check out to the child's name?
I have a few nieces that I'd like to contribute to a savings account/529 or similar for them. I think some of them already have accounts, but I think some of them don't. Ideally, I'd like to know the money will stay theirs, but I guess even making the check out to the child is pointless right? If the parents want the money, they'll take it (not that I think this will happen in these cases necessarily).
If one doesn't have a 529, can I set it up for them or do the parents have to? I'm fairly ignorant about all of this. Sorry
If I want to give some money as a gift that would go to a 529 (or similar), should I write the check out to the child's name?
I have a few nieces that I'd like to contribute to a savings account/529 or similar for them. I think some of them already have accounts, but I think some of them don't. Ideally, I'd like to know the money will stay theirs, but I guess even making the check out to the child is pointless right? If the parents want the money, they'll take it (not that I think this will happen in these cases necessarily).
If one doesn't have a 529, can I set it up for them or do the parents have to? I'm fairly ignorant about all of this. Sorry
Posted on 11/29/16 at 1:46 pm to kennypowers816
I know with the LA Start 529 plan, you can download the forms that you would send your check with. All you need is the account information from the parents.
You may even be able to pay online as well. I havent looked lately.
You may even be able to pay online as well. I havent looked lately.
Posted on 11/30/16 at 11:17 am to Golfer
We did the 529 route but also did a savings account. The 529 is something we fund annually. We let all of the money they receive on Holidays etc, go into a savings. We also contribute a very small amount to each savings account each month. Our objective is to let them use this savings to purchase a reasonable vehicle once they are of age.
Investar Bank had a pretty decent interest rate for a minor account when we set it up..may want to look into that.
Investar Bank had a pretty decent interest rate for a minor account when we set it up..may want to look into that.
Posted on 1/25/17 at 5:33 pm to finfeathersport
got an infant myself now and going to do that LA 529 START. I cant see any parent in louisiana that has a child that will more than likely go to college not set up an account on there.
now gonna also do a savings account even though the interest rates are an absolute joke.
anyone research the cons to using goldman sachs online (1.05%) or Salem five direct online (1.10%)? the local banks are all under 1% from what i see.
now gonna also do a savings account even though the interest rates are an absolute joke.
anyone research the cons to using goldman sachs online (1.05%) or Salem five direct online (1.10%)? the local banks are all under 1% from what i see.
Posted on 1/25/17 at 6:12 pm to coonasstiger
i have LA START 529 plans for 2 kids & 2 godchildren.... get nice tax breaks from LA every year.
Posted on 1/25/17 at 7:08 pm to coonasstiger
I use the La Start to save for college (which can mean any college related expenses at most schools). I also have the UGMA for each kid that I add to from time to time. The tax rules have changed recently so it's not as attractive as before but it's still a good way to save for cars or other expenses. When they turn 21 it's theirs if not used before.
The Start program is easy because they will deduct from your account monthly and match it some. I've got $10k already for a 4 year old without even trying hard to save.
The Start program is easy because they will deduct from your account monthly and match it some. I've got $10k already for a 4 year old without even trying hard to save.
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