What's the best advice about College Savings / 529 plans? I've heard good - tax advantaged savings - and bad - penalties / overly accounted to make it seem you have more money to contribute to your kids than you actually do. (Not sure that's accurate... just what I heard).

Do you have a 529?

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I decided against 529 because I believe the educational landscape (college) will be much different compared to my (our?) experience. Therefore, I opened a normal brokerage account for each child at Fidelity Investments.

The account ownership is in MY name (not the child’s) and can use it for anything (not bound to education, etc). I also have control of the timing and access all kinds of investment options.

Some may say the taxes on the investment income is a downside but I have the funds invested in aggressive growth so very little dividends and I tax loss harvest to keep the positions from accumulating embedded gains.

When the time is right I will “gift” the money to my child up to the annual gift limit.

My 2 cents.

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I like the idea of being able to use it for anything, not just limited to education.

I started a 529 plan for my daughter with her inheritance. She was just about to turn 2. I don't remember having to account for it on her FAFSA last year. Thankfully, she received grants and waivers, so I only needed to withdraw for the flex dollars for meal plan and her books.

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It all depends on where you intend to send you child to. Yes we were advised to open a tax free 529 Plan but a few years later we told that it's better to save than to put money into that plan. Thankfully our kid got a Scholarship that paid for most, if not all of his tuition and that helped a lot.

I did my research on prepaid plans vs 529 plans. I’m going with a 529 plan. I like what Vanguard offers because they have the equivalent to the QQQ etf which I like over the SPY for growth and long term investing. The only drawback is it’s $3,000 minimum deposit which I’m saving towards now.

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