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-   -   Money Educational Savings Accounts (https://chiefsplanet.com/BB/showthread.php?t=293429)

noa 07-16-2015 09:55 AM
We have them for our boys, and my in-laws contribute, too. We chose a state plan that had a good reputation.
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Dunit35 07-16-2015 10:14 AM
It looks like Oklahoma has tax incentives for it. I always have to pay state taxes in January. Will that lessen my state tax burden? Do I start one on the Oklahoma website or contact an investment company?

mikeyis4dcats. 07-16-2015 10:59 AM
some states give tax reductions for thewir own plan, but some state plans are much better than others. You can use any plan.

Demonpenz 07-16-2015 11:09 AM
You could get better ror on your money, but if you don't know what you are doing 509 is ok.

excessive 07-16-2015 01:01 PM
I have about $18,000, but my son has a full ride. I can either save it for graduate school or take it out penalty free. I'll have to pay taxes, and that sucks, so I'm debating what to do: "Pay your own damn way to graduate school, you deadbeat freeloader" (actually, he's a great kid and deserves the help) or "Woo who! I've got 12G I wasn't planning on!"

mikeyis4dcats. 07-16-2015 05:33 PM
Quote:
Originally Posted by excessive (Post 11602195)
I have about $18,000, but my son has a full ride. I can either save it for graduate school or take it out penalty free. I'll have to pay taxes, and that sucks, so I'm debating what to do: "Pay your own damn way to graduate school, you deadbeat freeloader" (actually, he's a great kid and deserves the help) or "Woo who! I've got 12G I wasn't planning on!"
Aren't those the same option?

Rain Man 07-16-2015 07:27 PM
Quote:
Originally Posted by mikeyis4dcats. (Post 11602606)
Aren't those the same option?
Apparently he's banking on his son not figuring that out.

Infidel Goat 07-16-2015 07:57 PM
I'd personally suggest reading to your kids, helping them with math, and hoping they win a scholarship instead...

007 07-16-2015 11:22 PM
Quote:
Originally Posted by kepp (Post 11601887)
From https://www.missourimost.org/content...529basics.html

What happens if the beneficiary doesn't want to continue his or her education?
If that's the case, you have a couple of options. You can stay invested in case he or she decides to attend school later (there's no age limit on using the money), you can change the beneficiary to an eligible family member, or you can withdraw the money for other uses. A 10% penalty tax on earnings (as well as federal and state income taxes) will apply if you withdraw the money to pay for nonqualified expenses.
Isn't it similar to an IRA that you could pull it out at retirement age without penalties? Seems like I have heard that before.

DaneMcCloud 07-16-2015 11:36 PM
Quote:
Originally Posted by Amnorix (Post 11601931)
If you think/expect your kid(s) will go to college, a 529 plan is hard to beat. Essentially it lets you invest money into an earmarked account which grows tax free and can be withdrawn tax free to pay for qualified expenses.

Some states, including Missouri, allow tax credits/deductions for certain contributions to a 529 Plan.

http://www.savingforcollege.com/arti...ally-worth-733


You do of course have the risk of losing principal, etc., but most 529 plans have options to invest in programs based on the year the kid is anticipated to start college. As the kid gets older, the risk matrix is shifted to reduce the percentage invested in higher risk assets and into lower risk assets.
I opened a 529 account for my newborn in mid-2008. I put in $15k to start.

By 2013, even after the crash and the market recovery, it was at $12k.

The "Stock Market", IMO, has become a "Market of Stocks". Nothing is guaranteed. Long term investments may or not be there in today's economy.

Buyer beware.

007 07-16-2015 11:51 PM
Quote:
Originally Posted by DaneMcCloud (Post 11603017)
I opened a 529 account for my newborn in mid-2008. I put in $15k to start.

By 2013, even after the crash and the market recovery, it was at $12k.

The "Stock Market", IMO, has become a "Market of Stocks". Nothing is guaranteed. Long term investments may or not be there in today's economy.

Buyer beware.
I won't even dabble in the market anymore. We only invest in highly stable and extremely conservative funds. We don't make much on them but at least we continue to gain and not lose.

MahiMike 07-17-2015 08:40 AM
We started a 529 plan but stopped it in lieu of Florida Pre Paid. We figured it would take an avg of 15% per year to equal the pre paid plan.

Dunit35 07-17-2015 10:30 AM
Quote:
Originally Posted by MahiMike (Post 11603211)
We started a 529 plan but stopped it in lieu of Florida Pre Paid. We figured it would take an avg of 15% per year to equal the pre paid plan.
I'm interested in the state tax benefits. This year I had to pay $700 into state. We both work two jobs, and both of us have one job that doesn't take much out due to not making much. We got boned for it at tax time.

ndws 07-17-2015 10:36 AM
I think you also need to take into consideration if you plan on the edu fund to pay for the majority or not. If you have an education fund in place, you severely hamper fafsa opportuties...well, at least if the "parent" is the keeper of the fund. I think a grandparent can open a fund, and then when the question is asked if the student's parents have an education account opened for him/her, then its a loophole and doesnt' nuke your fafsa application.

We have a 2 year old we are reviewing all options with right now as well, and this is something our planner mentioned.

Dunit35 07-17-2015 10:48 AM
Quote:
Originally Posted by ndws (Post 11603345)
I think you also need to take into consideration if you plan on the edu fund to pay for the majority or not. If you have an education fund in place, you severely hamper fafsa opportuties...well, at least if the "parent" is the keeper of the fund. I think a grandparent can open a fund, and then when the question is asked if the student's parents have an education account opened for him/her, then its a loophole and doesnt' nuke your fafsa application.

We have a 2 year old we are reviewing all options with right now as well, and this is something our planner mentioned.
Back in 2005, I was denied college grant money due to my father making too much, which was $50k for that year. They didn't bother to ask about the previous five years when he was barely working.

So, if finances continue the way they are for my wife and I, I expect our girls to get denied grant money also.


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