College Funds ??????

[TOBTEK]

WHICH ONES ARE GOOD, WHICH ARE BAD ? WHO DO YOU USE, WHO NOT TO USE?? Have a 401K which is desolving and need to transfer the money for the kids........ need advice please, Thanks.

[TOBTEK]

oops..... sorry for the double thread.

[DILLIGAF]

OPEN one of these. Of course check with your financial advisor first.
The 529 plans offer you four main advantages.
First, you get unsurpassed income tax breaks. Your investment grows tax-free for as long as your money stays in the plan. And when the plan makes a distribution to pay for the beneficiary's college costs, the distribution is federal tax-free as well.
Second, you the donor stay in control of this account. With few exceptions, the named beneficiary has no rights to the funds.
Third, in this account, you can replace the account beneficiary with another qualifying family member (including yourself) at anytime if your child does not need the funds.
Finally, one of the investment choices allows you to invest based on the date-of-birth of your child, known as aged-based and I prefer this approach. As an example, as your child moves closer to the date the assets will be needed, the fund manager will weight the account in favor of more fixed income, less equity issues. The goal is that downside (and upside) will be in a narrower range, as you get closer to needing the funds in the account.
If the 529 plans are not used for educational needs, federal law imposes a 10% penalty on earnings for non-qualified distributions beginning in 2002. This means that you will get back 100% of your principal and 90% of your earnings, subject to ordinary income tax rates. In addition, if you were able to deduct your original contributions (currently not allowed in California but it is being considered) on your state income tax return, you will generally have to report additional state "recapture" income. The penalty is not assessed if you terminate the account because the beneficiary has died or is disabled, or if you withdraw funds not needed for college because the beneficiary has received a scholarship.
You can “go direct” to the site below, open it yourself and not pay me any commission and that is what I would advise you to do as I will not be doing much on an on-going basis to earn commissions on amounts you will be investing. This is because the “age based” program is somewhat automatic. Lastly, I should point out that 529 plans are not guaranteed and can lose value, see the disclosures that will be included with the documents you receive when you open the plan. Plan details and documents can be found at: http://www.scholarshare.com/.

[Bre]

If you need my guys number/ email addy shoot me a PM. I put some money away for the kids for the same reason.

[Brady Bunch]

Toby, Give Ari "aka Lightning" a call. He has my kids 529 college plan.

[It's all Good]

We have 529s for the kids at Edward Jones. I can get the speicifics if you want. Money is invested in a few different accounts. Since the kids are young, a higher percentage is invested more aggressively. In the last 2 years the accounts have grown ~40%.

[DILLIGAF]

He can open the 529 himself without paying commissions

[DILLIGAF]

We have 529s for the kids at Edward Jones. I can get the speicifics if you want. Money is invested in a few different accounts. Since the kids are young, a higher percentage is invested more aggressively. In the last 2 years the accounts have grown ~40%.
One of these?
:)
OPEN one of these. Of course check with your financial advisor first.
The 529 plans offer you four main advantages.
First, you get unsurpassed income tax breaks. Your investment grows tax-free for as long as your money stays in the plan. And when the plan makes a distribution to pay for the beneficiary's college costs, the distribution is federal tax-free as well.
Second, you the donor stay in control of this account. With few exceptions, the named beneficiary has no rights to the funds.
Third, in this account, you can replace the account beneficiary with another qualifying family member (including yourself) at anytime if your child does not need the funds.
Finally, one of the investment choices allows you to invest based on the date-of-birth of your child, known as aged-based and I prefer this approach. As an example, as your child moves closer to the date the assets will be needed, the fund manager will weight the account in favor of more fixed income, less equity issues. The goal is that downside (and upside) will be in a narrower range, as you get closer to needing the funds in the account.
If the 529 plans are not used for educational needs, federal law imposes a 10% penalty on earnings for non-qualified distributions beginning in 2002. This means that you will get back 100% of your principal and 90% of your earnings, subject to ordinary income tax rates. In addition, if you were able to deduct your original contributions (currently not allowed in California but it is being considered) on your state income tax return, you will generally have to report additional state "recapture" income. The penalty is not assessed if you terminate the account because the beneficiary has died or is disabled, or if you withdraw funds not needed for college because the beneficiary has received a scholarship.
You can “go direct” to the site below, open it yourself and not pay me any commission and that is what I would advise you to do as I will not be doing much on an on-going basis to earn commissions on amounts you will be investing. This is because the “age based” program is somewhat automatic. Lastly, I should point out that 529 plans are not guaranteed and can lose value, see the disclosures that will be included with the documents you receive when you open the plan. Plan details and documents can be found at: http://www.scholarshare.com/.

[BarryMac]

Toby, Give Ari "aka Lightning" a call. He has my kids 529 college plan.
Ditto that, call Ari you wiener... :D

[RP2]

We have been putting $400.00 a month into my sons 529 since he was born a year ago and it has been very successful... not to mention we have total control over what he does with it when the time comes.

[TOBTEK]

pops in laws broker is saying we have to roll the money from the closing 401K into another 401 to avoid any taxes. Then can be placed into this 529 account.....sound right?

[bohica]

You will not be avle to transfer funds from a 401k to a 529 plan tax free.
Contributions to 529 plans are made with after tax money and future earnings will be tax free.

[TOBTEK]

You will not be avle to transfer funds from a 401k to a 529 plan tax free.
Contributions to 529 plans are made with after tax money and future earnings will be tax free.
ANYWAY to roll out of wifes 401K which is being terminated, into a account for the kids tax free? everyone keeps saying 529 account.....but im new to these things. Using the Rhino ROHICA ?

[riverroyal]

my financial advisor(wife) has the info on this one,call here tommorrow

[Jrocket]

So whats the best way to get your money out of a 401k and not pay taxes? Is there any way to transfer it to another money earning project with out paying taxes?

[THOR]

I have a 529 for each kid.

[TOBTEK]

So whats the best way to get your money out of a 401k and not pay taxes? Is there any way to transfer it to another money earning project with out paying taxes?
from what Leisas guy said today is that we have to roll the $$ from the 401 into a IRA. and it wont be taxed. we have to set up seperate 529's for the kids. There goes the F29 fund:(