Anyone a 529 millionaire?

[Anonymous]

Anonymous wrote:OP here — obviously we put too much money in these for our kids and their investment growth far exceeded are expectations but the rules for what you can use the money for are broad. We can always change the beneficiary with any leftover money to our grandchildren. I was also thinking of getting my private pilot license and instrument rating land could use these 529 funds to pay for it just by changing the beneficiary.

It's an excellent way to fund college for future grandkids. The money continues to grow tax free. Or use for your own education as you stated

[Anonymous]

No - because my husband doesn’t love 529 as an investment vehicle and we did not super fund it for that reason. We don’t want to have more in there than they would need for college. And, if we keep money in our own name but invested - we can still put it towards college.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP here — obviously we put too much money in these for our kids and their investment growth far exceeded are expectations but the rules for what you can use the money for are broad. We can always change the beneficiary with any leftover money to our grandchildren. I was also thinking of getting my private pilot license and instrument rating land could use these 529 funds to pay for it just by changing the beneficiary.

It's an excellent way to fund college for future grandkids. The money continues to grow tax free. Or use for your own education as you stated

I think you re not overfunded. Full pay for kids will eat a lot of that. Grad school will eat the rest. Anything left is for grandkids. Give it 20-25 years (post kids college) to build up again.

[Anonymous]

Anonymous wrote:

Anonymous wrote:No. It sounds to me like you overfunded. If you are very high net worth it doesn’t matter. But unless they go to the most expensive schools for undergrad and grad school I am not sure you will be able to spend this.

We had about $250k each, and my kids are now going to undergrads where they get almost free rides, so I wish we had saved less…

But if they do go to a Top school, those are $85K+ currently. My kid is at one. It's 5K+ more each year. So it will be $100K/year by the time his first kid enters college and at least $110K+ by their senior year. They could easily use $400K+ for just undergrad. Or they are well funded for a lower cost undergrad and all of PT/Med/Dental/Law/Professional Grad school.

But the time the younger goes to college (guessing at least 5+ years before starting), they could use up $450K+ for just undergrad.

Fact is, if you are targeting Top schools, very few give full rides.

Also, if you can fund them like this, they are likely High Income/higher net worth. So anything left can just be passed to the grandkids.

This. We have around this amount, too. My guess is it will cover undergrad based on where my kid has currently applied. I’m also likely saving it for future generations and paying for college outright.

[Anonymous]

Anonymous wrote:

Anonymous wrote:No. It sounds to me like you overfunded. If you are very high net worth it doesn’t matter. But unless they go to the most expensive schools for undergrad and grad school I am not sure you will be able to spend this.

We had about $250k each, and my kids are now going to undergrads where they get almost free rides, so I wish we had saved less…

But if they do go to a Top school, those are $85K+ currently. My kid is at one. It's 5K+ more each year. So it will be $100K/year by the time his first kid enters college and at least $110K+ by their senior year. They could easily use $400K+ for just undergrad. Or they are well funded for a lower cost undergrad and all of PT/Med/Dental/Law/Professional Grad school.

But the time the younger goes to college (guessing at least 5+ years before starting), they could use up $450K+ for just undergrad.

Fact is, if you are targeting Top schools, very few give full rides.

Also, if you can fund them like this, they are likely High Income/higher net worth. So anything left can just be passed to the grandkids.

Just curious why you are capitalizing Top schools? In your mind is it an official thing?

Also, I wouldn’t count your eggs before they hatch when it comes to grandchildren. Many of the kids st these Top schools are not really breeding material.

[Anonymous]

I have an only so I'm never going to get there unless inflation really goes crazy

[Anonymous]

Anonymous wrote:No - because my husband doesn’t love 529 as an investment vehicle and we did not super fund it for that reason. We don’t want to have more in there than they would need for college. And, if we keep money in our own name but invested - we can still put it towards college.

Why doesn’t your husband like 529s? Sure you can keep money in your own name in other investment vehicles but you don’t get the same tax benefits when used toward education expenses.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:With the recent run up in the market our Virginia 529s for our two children have now surpassed $1M. Anyone else in this situation? We superfunded the 529s not long after birth and after 5 years started adding to the 529 to continue the Virginia state tax deduction. Oldest child starts college in 3 years. Nothing fancy….just put the funds into the Total Stock Index Fund.

Wow. Did you invest in individual stocks?

Reading comprehension---it literally stated "just put the funds into the Total Stock Index Fund"

Thanks for the feedback. Just signed up for an online reading comprehension class. You're a life saver.

The OP literally had the answer in their short post. Yet you still felt the need to ask a ridiculous question.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:No. It sounds to me like you overfunded. If you are very high net worth it doesn’t matter. But unless they go to the most expensive schools for undergrad and grad school I am not sure you will be able to spend this.

We had about $250k each, and my kids are now going to undergrads where they get almost free rides, so I wish we had saved less…

But if they do go to a Top school, those are $85K+ currently. My kid is at one. It's 5K+ more each year. So it will be $100K/year by the time his first kid enters college and at least $110K+ by their senior year. They could easily use $400K+ for just undergrad. Or they are well funded for a lower cost undergrad and all of PT/Med/Dental/Law/Professional Grad school.

But the time the younger goes to college (guessing at least 5+ years before starting), they could use up $450K+ for just undergrad.

Fact is, if you are targeting Top schools, very few give full rides.

Also, if you can fund them like this, they are likely High Income/higher net worth. So anything left can just be passed to the grandkids.

Just curious why you are capitalizing Top schools? In your mind is it an official thing?

Also, I wouldn’t count your eggs before they hatch when it comes to grandchildren. Many of the kids st these Top schools are not really breeding material.

I don't care where the OP kids go. No it's not an "official thing". Just pointing out what plenty of schools (many in the T50 and beyond) currently cost and will cost in 3-8 years. If you are not eligible for FA, many do not give much merit (at least in the "top 50"). So if you want your kid to be able to choose wherever they want to attend, you might need to be paying $100K+ in a few years.

Also, not "counting the eggs before they hatch" for Grandkids. But we have 3 kids, and it is likely at least 1 would go on to have grand kids. All 3 most likely will but only time will tell. So yes keeping the extra in a 529 is a good financial plan, if you are rich. The $50K extra in your kids account at age 22 could easily be enough for 1+ grandkid to attend college in 20+ years. This money can be transferred easily to other family members, so it can also be used for nieces/nephews/etc.

[Anonymous]

Anonymous wrote:

Anonymous wrote:No - because my husband doesn’t love 529 as an investment vehicle and we did not super fund it for that reason. We don’t want to have more in there than they would need for college. And, if we keep money in our own name but invested - we can still put it towards college.

Why doesn’t your husband like 529s? Sure you can keep money in your own name in other investment vehicles but you don’t get the same tax benefits when used toward education expenses.

+1 The tax free growth is huge. Don't understand why you wouldn't at least aim to fund In-State total costs for your kids with 529s. Then if truly concerned, put rest in regular investing.
Given the money can be used for college/trade schools/etc we knew that our kids would be using it for something (turns out it's college for all of them).

[Anonymous]

This is why I funded the minimum to send my kids in state. And I modified the stupidly low assumptions on growth that they had in their calculators, given that I invested all in stocks. What a hassle to have that amount of money left over in a 529.

[Anonymous]

Similar boat. 3 kids, one a year away from college and the other two are 4 and 5 years away. $1.2M for all 3, which includes the VA Prepaid (so the $1.2 is actually worth more since the prepaid value only shows as $40K, $47K and $49K).

A little concerned about overfunding it, but we have hopes for graduate schools for all 3, and there are many ways to use the unused money, i.e. funding a Roth IRA, trades classes, leaving the $ in their names for their kids, husband and I traveling to Europe for some fancy education trip, etc..

Despite good grades and fairly high test scores, the odds of them getting into UVA, VT, etc... from NoVa is challenging, so out of state public university may be a necessity.

[Anonymous]

OP, I am in this boat too due to superfunding my kids' accounts in the early 2010s.

Read the rules about what else besides tuition you can spend this on (i.e. computers, books, meal plans, room and board or off-campus housing) and take advantage of all of those. If either kid goes to grad school then you're probably going to use it all, but if neither does then you'll have extra to either covert to an IRA (max $35k per beneficiary), cash out (with the 10% penalty) or create grandkid funds. If you don't end up having grandkids, it's still fine because you can transfer to a niece/nephew or else cash out later.

[Anonymous]

Anonymous wrote:This is why I funded the minimum to send my kids in state. And I modified the stupidly low assumptions on growth that they had in their calculators, given that I invested all in stocks. What a hassle to have that amount of money left over in a 529.

Depends, for us we plan to help with grad school and any future grandkids or our kids/spouses grad school, so the 529 is just a great way to get tax free growth and to not need to invest as much capital to make it happen. Imagine 25+ years of growth to help fund college

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:No. It sounds to me like you overfunded. If you are very high net worth it doesn’t matter. But unless they go to the most expensive schools for undergrad and grad school I am not sure you will be able to spend this.

We had about $250k each, and my kids are now going to undergrads where they get almost free rides, so I wish we had saved less…

But if they do go to a Top school, those are $85K+ currently. My kid is at one. It's 5K+ more each year. So it will be $100K/year by the time his first kid enters college and at least $110K+ by their senior year. They could easily use $400K+ for just undergrad. Or they are well funded for a lower cost undergrad and all of PT/Med/Dental/Law/Professional Grad school.

But the time the younger goes to college (guessing at least 5+ years before starting), they could use up $450K+ for just undergrad.

Fact is, if you are targeting Top schools, very few give full rides.

Also, if you can fund them like this, they are likely High Income/higher net worth. So anything left can just be passed to the grandkids.

Just curious why you are capitalizing Top schools? In your mind is it an official thing?

Also, I wouldn’t count your eggs before they hatch when it comes to grandchildren. Many of the kids st these Top schools are not really breeding material.

Indeed on the last point you are wrong. They are because they are rich.