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Daughters First Birthday Help With Funds
Posted on 1/20/21 at 6:08 pm
Posted on 1/20/21 at 6:08 pm
My daughters first birthday is Friday. We already have a 529 set up and contribute monthly. I intend to do as many say they do and match whatever she gets in money. I’ve narrowed it down to four options but I’m not sure what would be the best.
1) Open a custodial account and add the funds to it every birthday then hand it over when she’s older.
2) Put it in a high interest account so it can be withdrawn as she likes for “approved” things
3) Continue to fund her 529
4) A mixture of the above
Any other ideas? I know as she gets older she’ll want to keep the money but I’m hoping this can be a way where I can teach money management. When she’s older we’ll discuss putting away a certain percentage and letting her keep the rest kind of thing.
1) Open a custodial account and add the funds to it every birthday then hand it over when she’s older.
2) Put it in a high interest account so it can be withdrawn as she likes for “approved” things
3) Continue to fund her 529
4) A mixture of the above
Any other ideas? I know as she gets older she’ll want to keep the money but I’m hoping this can be a way where I can teach money management. When she’s older we’ll discuss putting away a certain percentage and letting her keep the rest kind of thing.
5
Posted on 1/20/21 at 6:24 pm to GAFF
I thought this was going to be a gofundme
Posted on 1/20/21 at 6:27 pm to supadave3
I mean if you want to help out I’ll set one up..
Posted on 1/20/21 at 6:33 pm to GAFF
In Korea and China the first birthday is a very big deal and all friends and family come and give money. It can be quite a lot. When my wife's Korean/Chinese best friend's grandson reached his first birth day, we gave him $500. He got quite a haul.
Posted on 1/20/21 at 7:08 pm to GAFF
quote:
Open a custodial account and add the funds to it every birthday then hand it over when she’s older.
Was recently in this situation and ran away from the custodial option. I don’t want my 18 year old all of sudden in control of $5-10k let alone anymore than that. Also it’s their account and will hurt them on financial aid. Keep the money in your control. We all think our princess will be a model citizen, but we won’t be able to stop them from blowing thousands on their first spring break.
This post was edited on 1/20/21 at 7:09 pm
Posted on 1/20/21 at 7:12 pm to ABucks11
529
Posted on 1/20/21 at 7:30 pm to ABucks11
quote:
Also it’s their account and will hurt them on financial aid.
Doesn’t the 529 have the same affect? I always thought any money saved for college counted against financial aid?
quote:
Keep the money in your control.
How did you do this? Open a separate account with a brokerage?
Posted on 1/21/21 at 9:42 am to GAFF
quote:
Doesn’t the 529 have the same affect? I always thought any money saved for college counted against financial aid?
I was told technically the 529 is your money and just can only be used by the “beneficiary”. The beneficiary can always change and you could theoretically pull out the principal and keep it. For financial aid it’s considered in the parents income/accounts and not directly the kids. I probably should research that more but I do have a 529 and was encouraged to do that because of tax free growth.
Yeah just keep an account “ear marked” for your kid. Either savings or regular brokerage.
Posted on 1/21/21 at 10:41 am to GAFF
I have UTMAs for all of my small children and am pretty aggressive with them. All stock picks and no MF. Hopefully, I pick winners and they will have a nice nest egg. Worst case is I lose the money and I will be stuck paying for three weddings myself.
Posted on 1/21/21 at 11:45 am to MSTiger33
quote:
I have UTMAs for my child and am pretty aggressive with them.
Well... aggressive enough. 100% VTSAX.
Posted on 1/21/21 at 2:22 pm to GAFF
I have a 529 for my daughter and a separate account not in her name, but definitely for her.
Congrats on doing this for your kid. That’s was us dads are supposed to do.
Congrats on doing this for your kid. That’s was us dads are supposed to do.
This post was edited on 1/21/21 at 2:23 pm
Posted on 1/21/21 at 10:14 pm to touchdownjeebus
Youre thinking right, do something now with mutual funds through vanguard due to low maint fees, etc...
My boy 10 has $3500 & was sitting in his custodial / minor bank acct & in various cd's as I didnt want to invest it in anything aggressive / high risk.
He isnt going to need this money for atleast 10 years & that was foolish of me.'She only 1, vtsax now....
Kicking myself for having it in cd's for 10 years already & not in something with more meat & potatoes....
My boy 10 has $3500 & was sitting in his custodial / minor bank acct & in various cd's as I didnt want to invest it in anything aggressive / high risk.
He isnt going to need this money for atleast 10 years & that was foolish of me.'She only 1, vtsax now....
Kicking myself for having it in cd's for 10 years already & not in something with more meat & potatoes....
This post was edited on 1/21/21 at 10:30 pm
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