College Savings Planner please help me.

[Culichor]

Please folks help me out here please
My son is 3 years old now, and my wife and I we are thinking to start a saving plan for his collage, I do not know where to start or what to do, can you, guys tell me what is the safest way to start something like that? Please guide me on this.
Thank you so much this is probably for me the most important question I've ever asked in my life, and thank you for your in put.

[zephyp]

US Savings bonds are interest free if used for education costs...check out treasurydirect.gov

http://www.treasurydirect.gov/

[Culichor]

Thanks zephyp

[zephyp]

My pleasure...may be some other vehicles out there. I bonds arent paying right now but they are tied to inflation and the prime rate. So, if you think those are going up then they are a decent investment -- if you ignore the part about being backed by the good faith of the US Gubment...

[LFS]

You can do 529's in VA. Also, there is the option to pre-pay college at today's prices.

http://www.virginia529.com/

529's can also be setup in other states for your children if you have out-of-state relatives who want to contribute.

[gunderwood]

You can do 529's in VA. Also, there is the option to pre-pay college at today's prices.

http://www.virginia529.com/

529's can also be setup in other states for your children if you have out-of-state relatives who want to contribute.

529s are one of the better options, but I would consult a financial planner. What risks you want to assume, what you want to protect against varies widely and how you plan to fund it vary.

[zephyp]

Without taking the time to go through the rules of a 529 program I would guess that there might be some catch or penalty if the money isnt used for education...in other words 8 years from now you find yourself in a different circumstance and no longer wish to participate and want to spend the money for something else.

No risk with savings bonds. If you would rather buy bubble gum you can only then you are taxed on the interest. Notwithstanding of course if the country goes bankrupt...

[KaosDad]

WIth a 529 you can continue to "roll it over." So, let's say save up $300K for JR's college, but he gets a scholarship and only uses $100K. The rest can be rolled uover to another child or even Mom or Dad. And it doesn't necessarily have to be for "trasitional education." Just at an accredited school.

DK - did you mean "interest free" or "Tax free"?

One more thing - don't get hung up on college name and don't ignore community college. There are great incentives from VA Colleges for students who do two years in the Community College system then transfer.

[Yarddawg]

One more thing - don't get hung up on college name and don't ignore community college. There are great incentives from VA Colleges for students who do two years in the Community College system then transfer.

+1 My daughter is doing that now. She is in her second year at Thomas Nelson Community College, and plans to transfer to Old Dominion University next year.

[Jakeiscrazy]

One more thing - don't get hung up on college name and don't ignore community college. There are great incentives from VA Colleges for students who do two years in the Community College system then transfer.

+1 My daughter is doing that now. She is in her second year at Thomas Nelson Community College, and plans to transfer to Old Dominion University next year.

+2 I plan on doing that as well. As it is now I'm taking a duel enrollment class at the Chesterfield Tech Center. It's worth 20 credits(21 with an internship) at John Tyler.

[t33j]

I've gone 4 years on a 529 and it's been great paying tuition rates from about a decade ago.

My roomate (senior econ student) who is also doing it, says it's one of the best investments you can make.

Yarddawg: Tell your daughter to bring her gun (hope she has one)

[zephyp]

WIth a 529 you can continue to "roll it over." So, let's say save up $300K for JR's college, but he gets a scholarship and only uses $100K. The rest can be rolled uover to another child or even Mom or Dad. And it doesn't necessarily have to be for "trasitional education." Just at an accredited school.

DK - did you mean "interest free" or "Tax free"?

One more thing - don't get hung up on college name and don't ignore community college. There are great incentives from VA Colleges for students who do two years in the Community College system then transfer.

I meant tax free and the point I am trying to make is lets say - to use your example - that I save $300k and then decide I want to buy a house instead of sending anyone to college or school.

What happens then? Withdrawal penalty or do I get my money back?

[KaosDad]

The 529 site is rather mum on that point. But I seem to recall it can be withdrawn at your normal tax rate and I imagine there is a penalty.

So, I see DK's point that if you oversave it could end up costing you.

[zephyp]

The 529 site is rather mum on that point. But I seem to recall it can be withdrawn at your normal tax rate and I imagine there is a penalty.

So, I see DK's point that if you oversave it could end up costing you.

If you are correct and you save at all in a 529 then part of the money is no longer yours...I would stick to savings bonds...that way you know you can do anything with the money that you like and its still yours...

[Culichor]

The 529 site is rather mum on that point. But I seem to recall it can be withdrawn at your normal tax rate and I imagine there is a penalty.

So, I see DK's point that if you oversave it could end up costing you.

If you are correct and you save at all in a 529 then part of the money is no longer yours...I would stick to savings bonds...that way you know you can do anything with the money that you like and its still yours...

SO FAR I STILL CONFUED, I really don't know what to do. Will be better to save money on his bank acct? Really I'm lost, so I don't know what to do best, to be honest I do not care about interest I am not looking for freebies all I wanted is my son education on a save hand, what would you do in my case?

[LFS]

So, I see DK's point that if you oversave it could end up costing you.

Which is probably not a problem most people will ever have.

[t33j]

The 529 site is rather mum on that point. But I seem to recall it can be withdrawn at your normal tax rate and I imagine there is a penalty.

So, I see DK's point that if you oversave it could end up costing you.

If you are correct and you save at all in a 529 then part of the money is no longer yours...I would stick to savings bonds...that way you know you can do anything with the money that you like and its still yours...

SO FAR I STILL CONFUED, I really don't know what to do. Will be better to save money on his bank acct? Really I'm lost, so I don't know what to do best, to be honest I do not care about interest I am not looking for freebies all I wanted is my son education on a save hand, what would you do in my case?

If you know it's going to be for education, participate in a 529...

[gunderwood]

The 529 site is rather mum on that point. But I seem to recall it can be withdrawn at your normal tax rate and I imagine there is a penalty.

So, I see DK's point that if you oversave it could end up costing you.

If you are correct and you save at all in a 529 then part of the money is no longer yours...I would stick to savings bonds...that way you know you can do anything with the money that you like and its still yours...

SO FAR I STILL CONFUED, I really don't know what to do. Will be better to save money on his bank acct? Really I'm lost, so I don't know what to do best, to be honest I do not care about interest I am not looking for freebies all I wanted is my son education on a save hand, what would you do in my case?

If you are certain the money will be used for education, the 529s are probably the best vehicle to do so. The problem is you need to know the ins and outs of them and it also depends heavily on your personal finances. I highly recommend a financial planner.

Of course the problem with all government programs is you have to trust the government. I highly doubt the rules for my employer provided 401k will be the same when I retire. The same goes for IRAs, 529s or any other program. I simply don't trust the politicians to not change the rules, so I limit my exposure to what I see as the biggest risk/threat...politics.

[Culichor]

Thank you all for the in-put I will still investigating on this topic thank you so much for the help.

[LFS]

I highly recommend a financial planner.

That's actually the best thing to do. Ask around to your friends, family, and co-workers if they have worked with a financial planner that they like. Some financial planners just want to sell you financial products that earn them commissions, so you need to be careful in selecting one. But its just like finding a good mechanic or dentist... usually somebody you know has the line on a reputable person.