College savings- only 4 years left

[Anonymous]

We have three kids and 529's with small amount of funds. Our oldest is going to college in 4 years and we are now able to save a lot more money monthly than we were able to in past years. Should we just put this money in something with no risk like a savings account since we will need it in such a short time? I know our 529 has age progression investing but they still seem to risky. If anyone else is playing college catch up with savings, where are you putting the money?

[Anonymous]

I probably wouldn't put it in a 529 (or at least not any more than to get the tax deduction if your state has one).

[Anonymous]

Your 529 plan probably has a money market account option that is very, very low risk. I assume that your youngest won't be going to college for at least 7-8 years, so a mix of investments that includes some with higher growth potential (but some risk) might be appropriate to cover your bases for the three kids.

[Anonymous]

Why not put it into a 529 for your youngest - not your oldest. This way your window of investment is longer and not as conservative.

When it is time to paythe bill - either re-allocate the $ from the youngest to the oldest OR pay cash.

[Anonymous]

Don't forget that the last year of tuition for your oldest will be 7-8 years from now, not 4. You can keep contributing while DC is in college to get the tax benefit.

[Anonymous]

For maximum tax benefit, you and your spouse can each open a 529 for each kid, up to the $ limit for the deduction. I'm in D.C. and it's $4000 deduction per tax payer, so even if we file jointly we get $8000 in a tax deduction. We also only have 5 years til the start of college (but as previous poster pointed out, 3 more years to pay so we'll plan on the $8000 per year for the next 3 years as well).

[Anonymous]

Anonymous wrote:Don't forget that the last year of tuition for your oldest will be 7-8 years from now, not 4. You can keep contributing while DC is in college to get the tax benefit.

This. We have had 529 plans since 2001 and we are still contributing for each child, including the oldest, who starts college in 4 years.