Reply to Are we suckers for diligently saving in our kids' 529s?

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[quote=Anonymous][quote=Anonymous][quote]We decided against 529s when we realized it could be used for college and nothing else. All things considered, huge waste if kid decides not to go to college or is unable to for some reason. [/quote]

Not a huge waste.  The penalty is small compared to the returns you could get (just 10% of returns is the penalty for withdrawal for noneducational use).  We made 35K in ours.  That really helps us with our son's college education, but if he had not gone, we would have still made a healthy return (no loss).  It is not a "huge waste".  You can also use it for another child, such as a niece, nephew or grandchild (or for yourself if you go back to school).

We did not have to file the CSS for the college that our son attended (one more reason we loved the school).  They also gave us merit aid.  We did not qualify for anything else.  The 529 made absolutely no difference regarding our ability to pay.  SAVE.  [/quote]

But wouldn't that be a $3500 penalty, for example, in your case?  Are you saying you wouldn't have earned as much returns via any other investment vehicle?[/quote]

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