Saving for Education

Society Business and Career
1

Hi All -

Whats the best type of account out there to save for your childrens’ education?
We’re in the USA and want to start putting away a little bit for the babies.

I’m think Education IRA or 529 — have a feeling the 529 is the safer bet?

2

Re: Saving for Education

Start saving cash and store it under the proverbial mattress.
Make sure that your child does well in school, takes level 4/honors and/or AP classes in high school
and takes part in extra-curricular activites ( Sports, National Honor Society, Community Service etc.) for a resume that
proves him a well-rounded student.
Make sure he reads a lot and is good in general math as high SAT scores can help.
This will ensure that he can apply to several scholarships (free money that does not have to be paid back).
Putting money in mutual funds may make or lose money for you.
Don't rely on gimmicky tools such as the 529 accounts. There are too many catches.
Don't put any money under your child's name because when it is time for financial aid calculation,
all the money under his name will be expected to be used for his college expenses.
Only a percentage of the parents' assets is expected to be used for college.
Also if your state has good, reputable state colleges/universities, aim to send your child there as they will be cheaper.
And there is not much advantage in going to far away expensive colleges when it comes to finding jobs after graduating.

3

Re: Saving for Education

529 Gimmicks? Really?

And it doesnt matter if the money is in his name or mine; it will effect his financial aid status.

appreciate the reply.

I'm a little alarmed by the lack of response.
Does this mean desi parents are STILL not putting money away for education?

4

Re: Saving for Education

I first want to pay-off mortgage :D

I tried to look into 529 but then got busy in other stuff, though I have a vague plan of how to do it.

5

Re: Saving for Education

The rich ones don't need to.
The poor ones can't or are busy making ends meet.
Middle class are trying to pay off house mortgages and expect the kids to get educational loans (which is sad because then the kids start out life starpped with ton-load of interest bearing loans).

[Plus, I don't think there are many American Desis on these forums - let alone those who are parents.]