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re: Savings Plan for Children - 529 vs. Other Options
Posted on 3/1/24 at 8:03 pm to slackster
Posted on 3/1/24 at 8:03 pm to slackster
quote:
Lastly - people tend to be overly aggressive with investment choices in 529s. The timeline for a kid in high school, for example, is at best 4 years to start a 4-5 year drawdown. Having the entire balance in an equity index fund starts to make a lot less sense than it did when they were 2.
Can absolutely envision this being a frequent problem. While I don’t love the higher expense ratios, I’ve actually got a target date fund that will automatically adjust the profile for this exact reason.
1
Posted on 3/2/24 at 4:49 am to lynxcat
Keep in mind you can also roll any unused funds towards the grandkids at no penalty. Between all the different avenues to get your money back out and now this new IRA rollover option there really is no risk in my opinion. We have three kids and have been contributing $400 per month per kid to the LA start since the day they were born. If it’s looking extremely overfunded at some point I may stop making payments when they reach high school but I doubt it. I’d love it if my kids got a full ride somewhere and I was able to roll their entire account over for their children.
Posted on 3/2/24 at 7:12 am to TitleistProV1X
That’s a good point too. 
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