Where Is The Best Place To Put My Kid’s College Fund?
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- เผยแพร่เมื่อ 8 พ.ค. 2024
- Where Is The Best Place To Put My Kid’s College Fund?
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ESA contribution limit is 2000 $/yr,
While 529 has no yearly contribution limit, except the lifetime 235k $ per beneficiary (15k gift tax limit doesnt apply to 529 gifts).
I opened UTMA account for all my kids. They will work and their money will Into that account what they choose to put in. When they graduate the money is theirs and they are free to go whatever direction they want. Godspeed.
Don't worry about expense ratio just get an index fund, with expenses close to zero
529’s are a great investment vessel for kid’s future tuition.
That wasn't the question
It's advice like this that many people say don't follow Dave's investing advice. the expense ratio is in the top three most important factors in investing. for example, two different accounts, one has an ER of .02, the other 1.02. over ten years they each average 7% annual returns. the first account paid $173 in fees, the other $8558. not a drastic difference but certainly not nothing. have the same return but instead of 10 years, over 40 years and the first account paid $11,774 in fees, the second paid $519,257 in fees! literally a half million dollars more. So essentially the second portfolio has to achieve a much higher rate of return than 7% to justify its fees. so its definitely worth paying attention to more than 10% of your time
Amen-- I'm always so confused by Dave's poor investment guidance. He's so good at getting out of debt, but terrible at helping people find optimal, simple investment strategies. It's always bothered me.
ETF' or index funds. They pay out the same as mutual funds. With less fees.
VOO is a great ETF index fund
Index funds if you want growth consider a ETF that tracks growth.
I love Dave Ramsey, but I STRONGLY disagree with his investing advice. Expense ratios are very important and fund performance is always elusive and inconsistent. I wish he did a better job of preaching low-fee index funds with firms like Vanguard. Fees will eat your growth.
On expenses ratios, don’t ignore costs. Ignore Dave. Anything over 0.10% should be automatically disqualified
Amen!
Texas 529 annual limits are $15k for single filers and $30k for joint.
Wrong Texas 529 plan max aggregation value is $500k. The $15k/yr is a federal gift max. You can forward a 5yr gift of $15k/person giving a person $75k lump sum they can put into a 529 plan today. If married then double the amount to $150k lump sum investment into a 529 plan today.
If she knows what an expense ratio is, she shouldn't be asking Dave for advice.
Yerp.
To be fair she had 200k making near 0%. And her other kids probably will get scholarships so she probably doesn’t want that in a 529 due to lack of flexibility.
She should of been putting this money in 529 accounts years ago.
THX
Reporter asked a simple question “what if the child doesn’t go to college?”
She refused to answer him, makes you wonder if it’s really a good idea.
Money can be transferred to a Roth IRA if not used for qualifying expenses per 2024 changes.
The best place to put your kids college fund is my pocket.
Dave said 10k per year can go into a 529. Isn’t it 15k for single person and 30 k for married. Couldn’t they put 30k in 529 now. That people would be tax free in seven years. Take another 30k and put that into a high level savings till January 1 2022. New tax year. Now move that into 529 after Jan 1. That would leave 140k that should be put into a fund now. Wouldn’t this work.
Not sure this is legal. Can minors set up a 529. Surely it would mess with any chances of any kind of aid. Sounds like they are over the limit. Could the parents gift the child 30k now and have them set up a 529. Not sure minors can do that.
Couple could actually put the $200,000 into 529 now. 30k of the 200k would be under the gift tax. The other 170k would go against their lifetime gift limit. An IRS 709 would have to be filled out. CPA might charge $1,000. Cheap when you are getting the tax break.
@@kevinmeyer8068 Yup it’s called the 5yr forward gift rule. Each parent can contribute $75k to each beneficiary today. This caller is married and with two kids to setup 529 plans so this caller can actually put $300k today into a 529 plan.
@@famousamos1 forgot about second child. Good catch. Why didn’t Dave mention this. Of course her financial advisor better be telling her these things.
@@kevinmeyer8068 because Dave is not smart about investing and he doesn’t really listen to the callers. Also Dave didn’t even know you can contribute to a 529 with gift rules as he was thinking you can only put $10k/yr.
Dave is only smart at helping dumb people get out of debt. He has Smart Investor Pros aka Financial Advisors to give investment advice.
Again shows that Dave isn’t smart on investing. You can gift $15k/yr per person and forward the gift 5yrs in advance into a 529. So if this caller is married they can contribute $150k per kid since the caller has two kids essentially they can put in today $300k since she is married. 529 plans per state vary on lifetime max where balances can’t exceed $235k-500k. The $10k only applies to state income tax deduction.
Michigan has $500,000 cap. What if you put $200,000 in a child’s account at say age 3. It would grow to more than the $500,000 by the time they graduated from high school. I am sure you can’t contribute has soon as it hits $500,000. If the account grown to say $600,000 can you keep it in with no knew contributions or do you have to bring it down to the state max?
@@kevinmeyer8068 yup each state 529 plan has a maximum amount. Once the plan is over the max then you can’t add to it. You don’t have to withdraw it if it’s over. You can however open another state 529 plan and contribute up to the max for that other state 529 plan. However who needs that much money for higher education except for Ivy League Universities possibly. Or you can just change the beneficiary to another person if the child doesn’t spend it all.
@@famousamos1 my son’s school is $53,360 per year. Way less with scholarships. School will take 4 1/2 years because they do co op. Without scholarship total would be around $240,000. That is crazy. Friend of mine in high school went to same university starting in 1986. Cost then was $3,500 per year.
And what's the benefit of gifting it? I don't see how that helps the caller, she was asking into what investments she should do.
@@webfreakz that’s how you get $200k into a 529 plan today and not through many years. You forward 5yr gift rules of $15k/yr per person without gift taxes.
She assumed they will go to graduate lvl school.
I’m saving money to pay for my child’s college but not tell my child about it. Have her take out her own loans. When she finishes her degree, surprise! It’s paid for.
Why? There are fees to take out loans. And she may not want to go to school if she knows she will incur loans.
@@staceyalbert2658 someone just talking BS. Child pulls loan for say $80,000. Dad pulls check for $80,000 from 529 after college graduation. $80,000 is added to his income unless he has something saying it was a qualified college expense. Dad would be giving daughter $80,000 for repayment of loan in her name. Something doesn’t add up.
@@kevinmeyer8068 He wouldn't be using a 529 with this plan, but I agree it's BS. Plus teaching your kid to take out loans and then removing the consequences of taking out loans is the worst lesson ever!
529 plans need to have money withdrawn the same year it’s paying for college.
@@philipgerry5228 thank you. That is what I thought. Question for you. If my son starts his next semester in college just after January 1 will his money be due end of December or first part of January to keep it in the same year as withdrawal and usage. I was wondering that question before you posted. Thanks
Amc 🚀
Lol
Where is the best place to get a 529 in California
Bank of America or TD Ameritrade
@@mikebayless4268 how about Credit union banks ?
@@mateoort4187 possibly but you want to go somewhere that has an option for the funds to be invested in a brokerage account aka stocks
@@mikebayless4268 Credit union banks don’t Brokerage account ?
@@mateoort4187 check your local credit union and ask
Im glad my parents didn't save anything for me to go to college, they'd be quite disappointed when i decided to build wealth without a degree
That’s completely fine that u did that but it’s still an investment account
@@marktheshark2569 agreed! even if the fund isnt used for college eventually, it can become generational wealth or maybe even to buy a house!
Just Yolo kids tuition in options if you're worried about the expense ratio of the index fund ;)
Buy gold
Let your children pay for their own college.
If you could afford to help your child you should.
😂 ok Tom
Pay for their college but don’t offer an allowance let them work for their own gas, fun etc.
their*
I had to. Sorry internet college and wrong their in the same sentence needs to be corrected.
@@ThatPrestige I agree with you completely
If Dave would get out of being stuck in 1987, he would tell this lady to buy Bitcoin and her money will more than triple in 7 years!!!!!!!!! All you crypto haters can say what you want...I deal with these little things called FACTS!!!!!!!!!
lol
You’ve got a short time horizon. That changes things.
Casey the Spammer!
Casey the Spammer! 😂
Another episode of when a disingenious non-millionaire fraud tries to give advice
Keep doing you Casey. You are an intelligent young man. Forget these haters.
@@alexfonseca2063 - Go pound sand! Spammer lover!
Just vote for Bernie and it will be free
Democratic primary ended a while ago
This mom should refrain from boomer funds and go all in on Tesla stocks. At these low prices, they are practically giving away Tesla stock.
THX