Answers in College Planning

Top private colleges and universities can cost over $200,000 over 4 years, and these costs are only going up over time. How much money should you save?
1 vote
Given the stated intent of expecting the UGMAs be used for college, I agree with Andy's point about considering a 529 UGMA. Your oldest is 18 so the benefit of future investment gains growing tax-free and if used for college remaining tax-free may be ...(more)
2 votes
Another thing to factor into your decision...Many states allow for deductions against state income tax for contributions to their (state sponsored) 529 plan. Depending on your state and its income tax rate, this could add to the value of a 529 plan versus ...(more)
4 votes
Andy Tilp, CFP® Level 16
Michael, Robert and Craig made some good points. Just to reiterate regarding the retitling of the account. The money in the account will legally become your son’s and he can use it for whatever purpose he so chooses. (This is why UGMAs are sometimes called ...(more)
4 votes
Michael, An UGMA account is a Uniform Gift to Minor Account that provided the parent with control over the funds until the child reaches age 18. Then they can access the funds and spend the funds as the child wants, no parental controls. Yes when the ...(more)
2 votes
The answer to this question is simple. Assuming that the college investment you are making is the same in amount and timing of investment, in a 529 account versus a personal account, the benefit of the 529 accounts "Tax free" status on all 529 account ...(more)
1 vote
Adi Benyishay Level 13
The simplest way to look at it is – Taxable (capital gain & dividends) as you go along, or tax free as long as it is used for education. Therefore, to calculate the equivalent total return of a taxable account use the 529 return and add to it your ...(more)
1 vote
All the answers are great but beware of losing the forrest for the trees. The important issue is investing enough and in the right strategy to have enough to meet your goals. Just make sure that you dont let the registration decision hold up implementation ...(more)
0 votes
Another consideration is whether your state allows a state tax deduction for contributions. Consider two scenarios: 1) If your state allows deduction and your accounts are currently held with home state, be aware the state may reclaim past deduction ...(more)
4 votes
I favor holding the assets in the parent's name in a 529 savings plan. This has multiple advantages: 1) retain control of assets after child turns 18 (in case they don't want to use for school) 2) parental assets counted at lower % toward expected ...(more)
1 vote
Absolutely! You have the right to appeal and discuss the findings with the financial aid officer. Your case may be strengthened by mitigating circumstances in your income or asset situation (change in job status since the base year income used for calculating ...(more)
2 votes
In my college financial planning practice, I come across this sort of question very often. Generally, funds held in the student's name are assessed at a greater rate than your funds. There's a bit of a loophole for 529 accounts owned by the parent with ...(more)
5 votes
Philip, I agree with Donald. There is room to negotiate with the Financial Aid Officer at School 1. As noted by Donald, be prepared to discuss the other aid packages. While the school obviously can decline to adjust its standing package, asking the school ...(more)
5 votes
Don Level 19
Philip, the answer is YES they certainly do reconsider. Some amount of aid is kept in reserve to enhance offers for kids schools really want. Write a letter and follow up with a call to the financial aid office indicating that the school is your child's ...(more)
5 votes
Amos, The system sees it this way. -The child is your dependent and therefore you are responsible for the childs financial obligations. - Whatever funds are in the students name will be consider available to support the cost incurred and then they look ...(more)
5 votes
Hello Amos, This is a really tough area and there are pros and cons to both arguments. Education IRA's are tax free for education - but limit the amounts that you can put in quite a bit. 529 plans are also tax free for eduation - but are quite often ...(more)
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