I already contribute to my kids 529 for college. I was thinking about starting to contribute the yearly cost of my kids tuition in lump sum each year and letting it grow tax free for a year. I figure after 10 or so years I would have a decent amount to either pay a portion for their senior year of high school or roll over to their college fund.

Even though there is no state income tax deduction, it seems like the tax free gains after a few years would be nice. Anyone else do this? Would the gains here beat out a HYSA? Any other suggestions?

This post was edited on 4/8/20 at 8:58 am

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Posted by fatboydave

Fat boy land

Member since Aug 2004

17979 posts

Posted on 4/8/20 at 9:26 am to TypoKnig

It would be a lot better with a deduction or enhancement.
Have you maxed out all your retirement accounts?

This post was edited on 4/8/20 at 9:27 am

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Posted by TypoKnig

Member since Aug 2011

8928 posts

Posted on 4/8/20 at 9:30 am to fatboydave

quote:
Have you maxed out all your retirement accounts?

Yes. Employer retirement plans and Roths are maxed.

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Posted by Dandaman

Louisiana

Member since May 2017

704 posts

Posted on 4/8/20 at 1:09 pm to TypoKnig

I do it. I have about 10 more years until high school, so a significant amount of time for growth. I like the rollover to college option too, if my kid starts hanging out with rich kids that might go out of state.

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Posted by tigerfan4120

Member since Dec 2003

3262 posts

Posted on 4/8/20 at 1:37 pm to Dandaman

Isn’t there an amount that is deductible for state taxes?

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Posted by TypoKnig

Member since Aug 2011

8928 posts

Posted on 4/8/20 at 1:43 pm to tigerfan4120

quote:
Isn’t there an amount that is deductible for state taxes?

In Louisiana there is a state tax deduction for the 529 college savings plan of up to $4800 annually per kid per couple filing jointly. There is no state deduction for the K-12 plan.

This post was edited on 4/8/20 at 1:44 pm

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