future for the kids

doggie750

yep, polks getting ready for some serious investments for my 3 kids for the future. I am hoping you guys can give me some concrete advice to set them up financially. Thinking of bonds and mutual funds, got any 2cents for meh where to put some college funds. Thank you...:)

madmax

There is a special tax free account. http://www.savingforcollege.com/intro_to_529s/what-is-a-529-plan.php You know, if they work hard through school and work the system for grants and scholarships when the time comes they probably won't have to pay for it out of pocket.
madmax

Pycroft

+1 Open a 529 account. Like a 401k for your children, only no matching You take it out when they are college aged.

seeclear

I may be wrong about this, but I think when we set up the kids' college funds we were told that the 529 account becomes the kid's money. IOW, if they decide not to go to college, that is still their money, not yours. For that reason, we just set up mutual funds in my wife's and my names for the college $ funds. I could be remembering incorrectly, or maybe that has changed by now, but I wanted to be able to put that money toward my retirement if the kids didn't go to college. FWIW

Polkersince85

The best investment you can make is like Max said, make them study and do good in school. No if, ands or buts. My son is a junior this year majoring in Math and Computer Science with a 3.99 GPA. 100% scholarship to this point.

madmax

Polkersince85 wrote: »

The best investment you can make is like Max said, make them study and do good in school. No if, ands or buts. My son is a junior this year majoring in Math and Computer Science with a 3.99 GPA. 100% scholarship to this point.

My comment came from knowing several high school and college students who are doing it. It is not hard but takes time and energy. Some of the guys I know spend a few hours a day researching and writing to people looking for opportunities. They all get multiple responses and have to turn down several good ones to take the best. By the time they talk to everyone they have the interview process down to an art which helps them later when they look for real employment.
madmax

Demiurge

doggie750 wrote: »

yep, polks getting ready for some serious investments for my 3 kids for the future. I am hoping you guys can give me some concrete advice to set them up financially. Thinking of bonds and mutual funds, got any 2cents for meh where to put some college funds. Thank you...:)

Bet it all on horses.

exalted512

Polkersince85 wrote: »

The best investment you can make is like Max said, make them study and do good in school. No if, ands or buts. My son is a junior this year majoring in Math and Computer Science with a 3.99 GPA. 100% scholarship to this point.

I had a 4.06 in high school. My first semester was paid for. I got like $500 for my second and I applied for over 250 scholarships. I was also an eagle scout and had extra curriculars.

Point being, dont count on good grades. If youre going to a top tier school, your grades are more than likely going to be around average.
-Cody

dpowell

Invest in dollars and T-Bills. A heck of a future there......:eek:

kn505

Although 529 is not tax deductible on your federal tax, but it can be deductible on your state tax. In Nebraska, up to $5000 is tax deductible per year per family (not per child). Check with your state. You dont have to have the 529 plan with your state. You can have it with Nevada (or others) which is run by Vanguard.
If the distributions are used for education, there will be no tax on any investment gains. You ,and not your child, own the 529 plan even though you and your child name are on the account. If the child on the account does not use all the money in the account, you can change the name of the child to another person (you, other children, their kids, or just to my name).
You might want to have your child involve in the IB (International Baccalaureate) program that is offered at many public junior and high schools. If your child is doing good and pass the optional exams, your child can save up to around 30 college credits (which is about one year of college).

jflail2

Here's another vote for the 529 plan. I have been begging my sister to set up my niece and nephew for several years now. Once I get squared away financially, I might take up that burden myself. It's just too valuable an investment not to, and the tax benefits are definitely a boon.

Also agreed on the IB or "AP" classes. When I was in HS I took 4 AP classes my senior year, but didn't pay for them, and ended up missing out on basically an entire semester's worth of college credits. I wasn't exactly serious about school back then, but it wouldn't have been hard to make A's or B's in all of those classes, and start college off on the right foot.

CCNJ

Another vote for 529 plans. Here some advantages based on an article from Bankrate.com...

"The pros of the savings plans: Earnings grow tax-free, and when it's time to matriculate, you can take the money out without paying federal taxes, as long as the money is used for qualified education purposes.

On top of that, the earnings may be free of state taxes, and you may also get handsome state income tax deductions for contributions made along the way."

I will say however that not all 529 plans are the same. You should research online to find out opinions from reliable sources to see which ones are the best. You are not limited to the ones offered by your state. Key considerations should be the lowest fees and best investment options.

Hope this helps.

Polkersince85

Love him or hate him, but Clark Howard does do some good research.

http://clarkhoward.com/liveweb/shownotes/2010/03/08/17909/