Roth IRA to pay for kids' college vs. 529

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Poor person here . We max out 401k and IRA , and have little in college savings other than what grandparents put in
Since we are older parents , our children will be in college when we are 55, meaning we could take money tax free out of our IRA and help with college if we didn't think we needed it ourselves
Big if!
The problem with the 529 is that it cannot be used for anything other than college. Bottom line for us: our children can get loans and have a lifetime of work ahead of them.

You need to be 59 1/2, not 55, to withdraw money without penalty, unless you stop working.

Not correct . You can take money out of a traditional IRA without penalty for down payment on a first home or to pay for higher education. That is why for us, it makes more sense to put money in an IRA and have the option to help pay for college if we are doing okay. At 55, we should have a better idea of our earning and outlook and be able to make a Better decision than now at 38 and 40.

You can take ROTH IRA contributions out at any time with no tax or penalty. Only the earnings can't be taken out before retirement age without penalty.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Poor person here . We max out 401k and IRA , and have little in college savings other than what grandparents put in
Since we are older parents , our children will be in college when we are 55, meaning we could take money tax free out of our IRA and help with college if we didn't think we needed it ourselves
Big if!
The problem with the 529 is that it cannot be used for anything other than college. Bottom line for us: our children can get loans and have a lifetime of work ahead of them.

Kids in college at 55 is not older parents.

Again, poor person here . It is when most of your friends and family have kids in college at 40. Perspective , perspective .

Then they had their kids young. My husband will be 65. That is older.