Reply to Is $1000/mo in a 529 enough?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]What's your HHI?

You're missing out on tax benefits putting that much in a 529.

At the very least, put it in two 529s (one in your name, one in your DH's). If you are eligible for a Roth, I would split the thousand as $330 in your 529, $330 in your husband's, and the balance split between two Roth IRAs. You can use Roth money to pay for college, and in the event your child doesn't end up needing it, you still have it for your retirement.[/quote]

HHI is ~350k.  we both max out 401(k) (spouse has a 9% match; I have none because I work in biglaw).  In addition, we put away about $4000 in index funds.  We also each backdoor the maximum into Roth IRA accounts.

We each put the minimum into the state-sponsored 529 for the write-off.  The remainder goes into a 529 with Vanguard (fees are lower).  What would be better for us to do?[/quote]

In MD you can open 529 accounts in your names and each other's names. This way you can take advantage of the state deductions. Then you roll over to vanguard for the lower fees (at most once a year per beneficiary). [/quote]

I have been thinking of rolling my MD account into vanguard.  But there is a second tax benefit.  You don't pay taxes on capital gains, which over 18 years hopefully will be considerable.  If you keep it in the MD account, you don't pay state capital gains taxes, but I believe you would have to pay them from the vanguard or any other non-MD plan.  (There would be no fed cap gains tax either way.). Not sure whether expected tax savings makes the higher fees worth it or not.

Are you saying we can have four accounts?  If so, I need to do that.

Also need to roll everything over from T Rowe to Vanguard - haven't done that yet. [/quote][/quote]

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