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Message
My son is turning 1... Investment/Saving Advice
Posted on 5/26/13 at 9:59 pm
Posted on 5/26/13 at 9:59 pm
My son's first birthday is coming up and I've been thinking about what to do to start saving for him and his future. Planning to have additional children, so this will also apply to them.
Ideally, I'd like something flexible, but also would like the benefits of any available programs. I'm considering a 529, self-directed brokerage, or IRA/Roth withdrawal.
Is a 529 program (LA START?) a good option? What if he gets scholarships or I choose to spend it to say, buy him a car, or his home down payment?
I've also thought about creating a separate brokerage account and investing in some funds/ETFs and blue chips. This gives me the flexibility and is something I can "hand over" to him when he can properly utilize it. However, no tax benefits or "match".
Any advice? This will be my money, but it will be earmarked for him/them. That's part of my reservation with the 529, since it limits it to only qualified expenses. I'd like the money to be available for what I determine it should be spent on.
Ideally, I'd like something flexible, but also would like the benefits of any available programs. I'm considering a 529, self-directed brokerage, or IRA/Roth withdrawal.
Is a 529 program (LA START?) a good option? What if he gets scholarships or I choose to spend it to say, buy him a car, or his home down payment?
I've also thought about creating a separate brokerage account and investing in some funds/ETFs and blue chips. This gives me the flexibility and is something I can "hand over" to him when he can properly utilize it. However, no tax benefits or "match".
Any advice? This will be my money, but it will be earmarked for him/them. That's part of my reservation with the 529, since it limits it to only qualified expenses. I'd like the money to be available for what I determine it should be spent on.
4
Posted on 5/26/13 at 10:00 pm to LSUtigerME
ze bitcoin
Posted on 5/27/13 at 7:37 am to LSUtigerME
I do LA START and a self directed brokerage account for each of my kids. Also have a whole life insurance policy on each of them. Grandparents have education trust but I don't know much about that.
With Roth limits as low as they are I'm not using it as a savings account for my kids.
With Roth limits as low as they are I'm not using it as a savings account for my kids.
Posted on 5/27/13 at 8:42 am to yellowfin
quote:
Grandparents have education trust but I don't know much about that.
quote:
I do LA START
I could be incorrect not knowing your situation, but isn't the LA START unnecessary if they have an education trust? Or is it not enough?
Posted on 5/27/13 at 9:19 am to LSUtigerME
quote:
Is a 529 program (LA START?) a good option? What if he gets scholarships or I choose to spend it to say, buy him a car, or his home down payment?
Since you'd like to have more children a 529 is a good option. If your oldest doesn't use all/any of the money for college you can transfer what's remaining to another child.
quote:
Any advice? This will be my money, but it will be earmarked for him/them. That's part of my reservation with the 529, since it limits it to only qualified expenses. I'd like the money to be available for what I determine it should be spent on.
An UGMA would give you some tax breaks but the money you contribute is irrevocable and the child takes control of the account at age 18.
You could invest in a separate mutual fund for each child and transfer the account on your terms. I'd look at some low fee growth funds and invest a fixed monthly amount. You won't get any tax breaks but at least you won't incur any penalties.
Posted on 5/27/13 at 10:02 am to the LSUSaint
If there are any tax benefits to the trust I don't get them because I don't fund it. I get the benefits from the 529(I think it's state only)
Posted on 5/27/13 at 12:53 pm to LSUtigerME
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