529 Accounts for Your Kids? Pros/Cons? Other Alternatives?

Updated on August 25, 2011
S.H. asks from Kailua, HI
8 answers

Just trying to get an idea of pros/cons of 529 College Accounts for kids.
Or what other financial type accounts for kids college savings is better?
529 accounts, so complicated.

And then just for kids savings in general?
Not it being a 529 type vehicle per say.

Just looking for opinions of Moms/parents.
We do have a Financial Advisor too.
But just looking at a parent's opinion at this time... .and what you might have done per savings for your kids and/or for

Thank you!

1 mom found this helpful

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answers from Lynchburg on

Hi sh-

All my kids have 529 accounts...the only things that I have found 'odd' is that the account will not pay 'fees'...for example...my daughter is a animal science major...focus on horses/large animal...and there was a 'lab' fee for riding class...it would not cover it. Does not cover books...or off campus housing.

It is good for multiple kids in that if one child does not use the account (scholarships etc), then that $$ can slide to a sibling...

The other good thing (and I hope it never applies in YOUR case)...but my ex could not 'tap' into the account...and the slime DID try!!

All in all a good account I think...I looked at other options, but this one seemed a better choice at the time.

In our case...they seem a bit 'slow' sometimes in paying the respective institution...but some of the colleges were slow getting a complete bill ready...and expecting very quick payment...but that has varied college to college....

Best Luck!

6 moms found this helpful


answers from Las Vegas on

529's are a great way to save, tax-free, for a child's college or post-high school education. They really aren't complicated unless you mean trying to choose plan, as each state has thier own. You can invest in any state's plan, don't need to reside and/or go to college in the state's plan you're invested in. Choose one with low fees. The 'down' side is that all the funds must be used for eligible college expenses. Check out the U-Promise organization too, many companies will donate a % of purchase price to your account and then you can transfer those funds to your 529 plan (we've transferred over $600).

3 moms found this helpful


answers from New York on

We have a 529 for our son and a money market account in addition. The 529 is easy and tax-deductible. We watch the markets, but don't have to "manage" it excessively. It wasn't really complicated at all to set-up. The other account is for private school, should we elect to go that route so we wanted something more "liquid". If he attens public school, that money will get rolled into his 529.

3 moms found this helpful


answers from San Diego on

We have a 3 prong approach: 10 pay whole life insurance on our daughter (which builds up cash value that our daughter can borrow against when she reaches college - your advisor can explain). We then invest 1/3 into a 529 and the other 1/3 into tax free bond funds. We are funding every year based on how much money she will need for college when she turns 18. A sobering statistic but somewhere between $250,000 - $500,000.

We wanted flexibility with the money vs be locked down soley for education! She may be destined for other things like starting a business and need capital.

2 moms found this helpful


answers from Dallas on

We started our daughter's savings for college before she was born. After she was born, we went with a 529 for the majority of her funding but we also have numismatics, savings bonds and savings accounts set up for her.

We personally feel it is our obligation as parents to get her through college debt free and that is what we have planned to do and intend to do.

Our daughter is 16 and heading to 11th grade.

Good luck.

1 mom found this helpful


answers from Austin on

the 529 that was purchased 14 years ago has been awesome.. (Thank you mom!) Our daughter will be a Senior in college this fall.

So easy for the college to use. The rate is based on our in state college tuition, but our daughter actually attends out of state.. It is still a good amount.

It was originally purchased (1997) for a total of $4200. In the first college year it paid out $6000 and each year it has increased. Last year it paid out about $7800. for the year..

I think it was an amazing gift!

1 mom found this helpful


answers from Los Angeles on

I just have a regular savings account for my son along with my accounts in the bank. I put his birthday and holiday money there. I also have a 529 account through California and they use Fidelity Investments out of Boston. It is a managed fund you don't have to worry about what to invest in. I think 529 is a great investment.

1 mom found this helpful


answers from Los Angeles on

529 is the best! I would definitely try that and get started right away. And like the other poster said - Other adults can't tap into it (and neither can you if it isn't for college) and is a better option if you have trouble staying out of savings accounts, etc.

1 mom found this helpful
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