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Another investment question: Help with kids college investments


Another investment question: Help with kids college investments

Old 06-12-2012, 08:39 AM
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Default Another investment question: Help with kids college investments

Saw the mutual fund thread and reminded me of something I've been trying to do for a while. My two kids have accounts that were set up by Grandparents. Grandpa died and now the are sitting and I want to consolidate them into one investment for each kid so that I can continue to contribute. I do not bank with the one company, BOA and the other is American Funds with broker out of my area.

I've talked to a "financial advisor" a friend referred me to, but it just doesn't sound like they are interested as the amount is fairly low, less than $5K total.

What is the best solution, advice?
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Old 06-12-2012, 10:29 AM
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have them learn to sew canvas. every canvas shop i know is booked for months and always have been and they can work as much or as little as they want...in my opinion...a skill is the way to go in this economy.
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Old 06-12-2012, 10:36 AM
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My suggestion would be to contact Vanguard. They can go over all the options with you and their fees are very low. Their people tend to be well-trained and not on commission.

Have you looked into the Florida Prepaid Plan? It worked out great for us.
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Old 06-13-2012, 04:45 AM
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Probably the best choice would be a state sponsored 529 CS account, mostly because the earnings are 100% tax free to the kids (so long as the money is used for college) and most state's plans require only $500.
The only downsides to 529's are: some states have a yearly cap on contributions (many are $10,000 per account); there is a lifetime cap of $210,000 (sounds like a lot, but it won't even pay for 4 years of college at the high priced schools, much less graduate/law/medical school) which includes investment growth; and there are penalties if the money is not used as allowed.
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Old 06-13-2012, 06:24 AM
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The state tax deduction for a 529 savings account does not help you in FL, but you can still take advantage of the tax free growth of money in the 529 savings plan. Vanguard has one of the best and of course lowest cost. The plans are organized by states and you are NOT constrained to only participate in your own state's plan, you can use any state's plan.

I believe that FL has a very good prepaid tuition program which might be a good deal if you plan to send him/her to a FL state school. Google is your friend
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