DC 529 - holy heck

[Anonymous]

Stop the 529s already. Invest on your own into S and P ETF like Voo. Add a few individual stocks for excitement.You have much bigger control over your investments. You learn more about markets by being more hands on than investing in the fund they offer.
I had to take the high school graduation time all the way into next century, which is not an option, just to match my risk tolerance.

[Anonymous]

Anonymous wrote:Stop the 529s already. Invest on your own into S and P ETF like Voo. Add a few individual stocks for excitement.You have much bigger control over your investments. You learn more about markets by being more hands on than investing in the fund they offer.
I had to take the high school graduation time all the way into next century, which is not an option, just to match my risk tolerance.

Yeah and pay 20% LTCG plus state taxes when it’s time for college.

[Anonymous]

Anonymous wrote:
I'm sorry, OP. Returns from other options within the DC 529 would probably have been better. Usually you are given documentation which flags risks (higher risks, higher rewards), to enable you to choose.

We directly invested in certain stocks in a private account, since you can't hand-pick stocks in a 529. Our returns are significantly better than any 529 option. But we know what we're doing, and the industry and company we chose to invest in.

Narrator: They did not know what they were doing.

[Anonymous]

Anonymous wrote:Stop the 529s already. Invest on your own into S and P ETF like Voo. Add a few individual stocks for excitement.You have much bigger control over your investments. You learn more about markets by being more hands on than investing in the fund they offer.
I had to take the high school graduation time all the way into next century, which is not an option, just to match my risk tolerance.

529s offer the same index funds available in normal brokerage accounts, but with nontrivial tax advantages. There is no financial reason to “stop the 529s already”.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Stop the 529s already. Invest on your own into S and P ETF like Voo. Add a few individual stocks for excitement.You have much bigger control over your investments. You learn more about markets by being more hands on than investing in the fund they offer.
I had to take the high school graduation time all the way into next century, which is not an option, just to match my risk tolerance.

529s offer the same index funds available in normal brokerage accounts, but with nontrivial tax advantages. There is no financial reason to “stop the 529s already”.

+1 You can invest in index funds in 529 plans 529s have an immediate state tax benefit and a tax benefit on growth. If you don't use it for the original beneficiary you can use it for others and there are plenty of escape valves if you don't need all of it for educational reasons. There's no reason to stop--you should just treat it like an ordinary investment though and examine carefully the options and the fees.

[Anonymous]

Anonymous wrote:DC has an instate university and acting like it doesn’t exist is really offensive.

LOL

please, it's offensive that you think that's a reasonable option

[Anonymous]

Anonymous wrote:

Anonymous wrote:DC has an instate university and acting like it doesn’t exist is really offensive.

LOL

please, it's offensive that you think that's a reasonable option

Lol! My kid went to UDC and did very well. There were some health-related issues that made it the best choice; they have an awesome disabilities office. I am cognizant that sending your kid there is just above child abuse for DCUM.

[Anonymous]

Anonymous wrote:

Anonymous wrote:DC has an instate university and acting like it doesn’t exist is really offensive.

LOL

please, it's offensive that you think that's a reasonable option

I didn’t say whether it was a reasonable choice for OP’s kid, I said it existed.

Stating that something doesn’t exist because you think you are too good for it is bizarre and offensive. Just say “we don’t plan on UDC”.

[Anonymous]

I've been in 100%equity since my kids were born ( now 5th and K) and my ROR is about 7% I think? I'll probably start switching to more conservative allocations around high school but maybe let it ride if the market is on an upswing.

[Anonymous]

How are they charging .74% for the large cap equity fund?!

[Anonymous]

You invest in the DC 529 S&P 500 fund up to the amount that gets you the full tax break. Then you invest anything above that amount in the Nevada 529 plan through Vanguard where the fees are lower. It doesn't matter which state's 529 plan you pick, the only reason to do your home state is for the tax break, but that is capped.

And of course you use the 529 - it's a huge tax break and they generally have an S&P 500 index fun which no one can actually beat by picking individual stocks.

[Anonymous]

I've got money in the age-based accounts in my DC529 and I put the excess in the age-based accounts of the Utah529, which is highly rated. Returns for the last five years have been virtually identical.

You'd be stupid not to use the DC529 for your first $8,800 in annual contributions - the tax deduction (assuming your income is above $60,000) amounts to an immediate 8.5% return.