Reply to How much do you save a month for kids college?

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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]$0. We will pay out of pocket and liquidate investments as needed. [/quote]

This has me curious.  Are you so wealthy that the tax savings aren't worth the added time and hassle?  I don't clip coupons for this reason and I've always wondered how this scales up with greater wealth.[/quote]

Im not impressed with the performamce of many of the college savingd plans out that as compared to what my portfolio returns. Haven't looked at the 529 in years...enlihgten me, how are the gains? We also have a few rental properties and one of those could get it done. Really why bother, i see a clear path already. [/quote]

Well, for starters, the returns aren't taxed, so there's a 30% gain right there.  [/quote]

Long term cap is at 20%, but I'm really curious what the returns are. Whrn i checkes yrars ago, thry were miserable.[/quote]

You can check online, but the returns are not great. Overall 5%. On the high risk option, around 12% (recently).  Pretry much the 529Invest in an underpreformer and can have high fees.

A decent option for the masses, but if you all ready have a managed portfolio, you will do much better on your own, even when paying long term gains tax.[/quote]

Ok, yea, i see that online now. Doesn't make sense for me at all. Im utilizing  tax loss harvesting and have seen returns in the last 18 months upwards of 18%.  On some individual tech stocks im played with (gambled) one in particluar has grown 32% in the last 3 months alone. With those tech stocks, i will say, I've dumped at the 1yr mark, so in some cases I'm taking my 80% growth and running.[/quote]

The dow is up 23% in the last 18 months, and you could have gotten that return tax-free in a 529...   :roll: [/quote]

As a holder of a 529, please do share which fund is getting 23%? [/quote]

https://www.virginia529.com/resources/performance/vsmi/[/quote]

So where is the 23%?

And BTW if that poster is tax loss harvesting, he/she is playing with millions and with tax loss harvesting a bump 2% this month or that month, compounds very quickly. I don't think a 529 is of much concern to that demographic.

I personally cannot risk being invested like someone who has millions, nor am I under ANY illusions at all that when my children graduate in 2025 and 2028 that we will be seeing 18% returns. I have my 529 diversified because the second Trump gets impeached or can't get his tax cuts through as promised, there will be a significant correction.[/quote]

The Dow is up 23% in the last 18 months, and the CRSP US Total Market Index that the Virginia 529 fund tracks is [url=https://www.google.com/finance?q=CRSPTMT]up 25%[/url] in the same time period (since 12/11/2015).

No one is claiming that any particular return is to be expected in the future from buying index funds.  I do, however, expect a higher return than previous posters who are speculating on real estate or their stock market hunches, even without accounting for the (considerable) tax breaks a 529 gives (such as the person in this thread who managed to get an 18% return over the last 18 months, and still owes capital gains/dividend taxes).

Were my net worth north of $50M, you're right, the 529 is enough of a hassle that I might not bother.  That said, people of much, much lower net worths (including myself) use tax loss harvesting.

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