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[quote=Anonymous]We are currently saving about 12% for retirement based on maxing out (tax benefit) 401ks at $17,500. The additional 12,000 will get us just over 15% annually towards retirement.

The college savings goal would be to fully fund in-state and to have some left over for graduate school. Or, if the DC so chooses, spend the entire amount on private and they can get additional FA to cover the difference and pay for their own grad school. Accordingly, we are budgeting for 35,000 annually (based on saving for college.com in state is $25,000 private is $45,000, so we are saving for $33,000). Yes, we are still low (they project savings at $845/month), but this is the best we can do now as we are currently paying for a nanny and part-time preschool for both and this will increase as they attend more days a week for the next two years. We hope to reassess our college savings goals once they are in elementary. And, based on prior annual bonuses that we have received we expect to allocate portions of our bonuses to college savings (probably $5k each annually).

Our income is beyond the IRA deduction limit. VA only provides $4,000 deduction per 529 account.

Since our expected per child contributions will be 6,000 (or 11,000 with bonus), should we fund the 529 with the full 6,000 (11,000), or is there more benefit (tax, financial, or simply the ability to have more flexibility over spending) to splitting $4,000 to 529 and $2,000 (7,000) to an IRA?  [/quote]

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