529 plan

[Mr Mirchi]

In state ithe yealy some 26k tho avundhi ..4yrs ki oka 110k …. Yealy 26k ok kadhaaa .. plan avasaramaa .. pls shed some light amma

[enigmatic]

22 minutes ago, Mr Mirchi said:

Yealy 26k ok

Chala vatiki 80 - 100 k per year. If you are studying in medical school it is longer than 4 yrs

[Anta Assamey]

41 minutes ago, baabaa said:

It can be used by sibling. Can also be used for grandkids also latest ga it can be converted to kids IRA/Retirement.

Basic concept is, lets say you invest $100 and it becomes $200 when your kids goes to college then you can pay college fee/expenses using those $200 without any tax.

Ade same $100 if you invest in same stocks which Utah Fund or Vanguard is investing, that will also become $200 but when you sell those stocks to pay for college you will have to pay tax.

Grand Kid varaku nenu think cheyanu kani... But IRA/Retirement over is good addition... Did not know about it.

[Pandubabu]

16 hours ago, elev said:

Evarina tiskunara which one is best

anything that has option of index funds and has minimal fees on maintenance and funds 

[perugu_vada]

1 hour ago, Mr Mirchi said:

In state ithe yealy some 26k tho avundhi ..4yrs ki oka 110k …. Yealy 26k ok kadhaaa .. plan avasaramaa .. pls shed some light amma

Agreed. . No idea naku kuda about this

[Mr Mirchi]

How it works

1. An adult opens the account and contributes money on behalf of a beneficiary. 
    
2. The money is invested in assets like stocks, bonds, or mutual funds. 
    
3. The earnings grow tax-free. 
    
4. When you need the money, you can withdraw it tax-free to pay for qualified education expenses. 
    

Benefits 

 

• Tax-advantaged way to save for education
• Contributions can be state tax deductible
• Funds can be used for a variety of qualified education expenses
• You can update the beneficiary if you don't use all the money

Drawbacks 

 

• Fees can vary
• There may be restrictions on changing plans or switching investments
• The money must be used for education

[Anta Assamey]

2 hours ago, Mr Mirchi said:

In state ithe yealy some 26k tho avundhi ..4yrs ki oka 110k …. Yealy 26k ok kadhaaa .. plan avasaramaa .. pls shed some light amma

This is today rates... but what about the time that kids go to school... the number might be different kada..

[rmJU72]

frontload large amount in any S&P based 529 plan

[meandhrakurradu]

5 hours ago, Mr Mirchi said:

In state ithe yealy some 26k tho avundhi ..4yrs ki oka 110k …. Yealy 26k ok kadhaaa .. plan avasaramaa .. pls shed some light amma

In state evadu elladu, pilla na kodukulu andaru prefer far away from home 

[krishnaaa]

3 hours ago, Mr Mirchi said:

How it works

1. An adult opens the account and contributes money on behalf of a beneficiary. 
    
2. The money is invested in assets like stocks, bonds, or mutual funds. 
    
3. The earnings grow tax-free. 
    
4. When you need the money, you can withdraw it tax-free to pay for qualified education expenses. 
    

Benefits 

 

• Tax-advantaged way to save for education
• Contributions can be state tax deductible
• Funds can be used for a variety of qualified education expenses
• You can update the beneficiary if you don't use all the money

Drawbacks 

 

• Fees can vary
• There may be restrictions on changing plans or switching investments
• The money must be used for education

Can we do individual stocks?

[CLP24]

 

this is not my idea but I am hearing from people around me are saying to take kids IUL instead of 529 which will be used for the kids education and also use for anything as it is insurance policy we don’t need to mention in fafsa application due to this it won’t affect their scholarship because you take it as loan. 

also plan is like below 

1. take IUL when they are young like 5. As insurance rates for kids will be very less take less death benefit and put more money towards cash accumulation. 

2. Take student loan from bank at 18 if needed.

3. We don’t need to mention in fafsa application as it is not asset.

3. We can pay loan principal after 5 years like when their age is at 23 as student loan will have some time to pay back like 5 years or something from the start of loan mean while  money in iul will grow.

4. If you don’t use this for kids education they can get loan from IUL and use for anything in future.

 

Pros:

When market downturn cash accumulated never goes down.

Some companies are providing interest locks if you feel market goes down

 

Cons:

Caps on the growth 

Commissions to agents and growth will be little slow

We can get kids IUL only if parents already have IUL

 

Again I am still in confusion on this whether to open 529 or get IUL.

 

As discussion is going on I want to share something I know and might help someone if needs to take decision and also I want to know which one is better if anyone into this.

 

[krishnaaa]

4 minutes ago, CLP24 said:

 

 

this is not my idea but I am hearing from people around me are saying to take kids IUL instead of 529 which will be used for the kids education and also use for anything as it is insurance policy we don’t need to mention in fafsa application due to this it won’t affect their scholarship because you take it as loan. 

also plan is like below 

1. take IUL when they are young like 5. As insurance rates for kids will be very less take less death benefit and put more money towards cash accumulation. 

2. Take student loan from bank at 18 if needed.

3. We don’t need to mention in fafsa application as it is not asset.

3. We can pay loan principal after 5 years like when their age is at 23 as student loan will have some time to pay back like 5 years or something from the start of loan mean while  money in iul will grow.

4. If you don’t use this for kids education they can get loan from IUL and use for anything in future.

 

Pros:

When market downturn cash accumulated never goes down.

Some companies are providing interest locks if you feel market goes down

 

Cons:

Caps on the growth 

Commissions to agents and growth will be little slow

We can get kids IUL only if parents already have IUL

 

Again I am still in confusion on this whether to open 529 or get IUL.

 

As discussion is going on I want to share something I know and might help someone if needs to take decision and also I want to know which one is better if anyone into this.

 

Its too complicated for me. Anything thats too complicated usually isn't a good path.

[meandhrakurradu]

43 minutes ago, CLP24 said:

 

 

this is not my idea but I am hearing from people around me are saying to take kids IUL instead of 529 which will be used for the kids education and also use for anything as it is insurance policy we don’t need to mention in fafsa application due to this it won’t affect their scholarship because you take it as loan. 

also plan is like below 

1. take IUL when they are young like 5. As insurance rates for kids will be very less take less death benefit and put more money towards cash accumulation. 

2. Take student loan from bank at 18 if needed.

3. We don’t need to mention in fafsa application as it is not asset.

3. We can pay loan principal after 5 years like when their age is at 23 as student loan will have some time to pay back like 5 years or something from the start of loan mean while  money in iul will grow.

4. If you don’t use this for kids education they can get loan from IUL and use for anything in future.

 

Pros:

When market downturn cash accumulated never goes down.

Some companies are providing interest locks if you feel market goes down

 

Cons:

Caps on the growth 

Commissions to agents and growth will be little slow

We can get kids IUL only if parents already have IUL

 

Again I am still in confusion on this whether to open 529 or get IUL.

 

As discussion is going on I want to share something I know and might help someone if needs to take decision and also I want to know which one is better if anyone into this.

 

Avoid IUL at all cost. Our kids will not get scholarship anyway, so take 529 plan 

[baabaa]

2 hours ago, meandhrakurradu said:

Avoid IUL at all cost. Our kids will not get scholarship anyway, so take 529 plan 

Not entirely true but unless the kid is super super talented it is almost impossible to get full scholarship. Our neighbor got full scholarship in UT-Dallas Comp Sci Bachelors but he also got admit in UT-Austin and he paid and went to Austin. Vala father complained many times that he had to spend close to $120K for his bachelors education[tuition+living expenses].

Kurra Vadini adiga why ra you could have gone to UT-Dallas for free ante cheppadu uncle i went for campus tour and the comp sci building was filled with indians from India and I got scared/disgusted and didnt want to go there. Appudu anukunna ABCD telugu kids scared of telugu kids from India.

[FrustratedVuncle]

3 hours ago, baabaa said:

Not entirely true but unless the kid is super super talented it is almost impossible to get full scholarship. Our neighbor got full scholarship in UT-Dallas Comp Sci Bachelors but he also got admit in UT-Austin and he paid and went to Austin. Vala father complained many times that he had to spend close to $120K for his bachelors education[tuition+living expenses].

Kurra Vadini adiga why ra you could have gone to UT-Dallas for free ante cheppadu uncle i went for campus tour and the comp sci building was filled with indians from India and I got scared/disgusted and didnt want to go there. Appudu anukunna ABCD telugu kids scared of telugu kids from India.

Not scared, but they don't like Telugus from India. ABCDs parents h1bs aina bayataki same origin Ani cheppukivadaniki istapadaru.