Putting money away for my son?

TRIGGER

TRIGGER

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I’m wanting to start my son a “college” fund. What are some options that earn interest? I have him a savings account but local savings accounts only earn .01%. Looking for ideas.
 
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John.M

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I have 529 savings accounts opened for my daughters through my bank (USAA). You can also open a mutual fund through a company like Vanguard, Fidelity, or a bunch of others. I like the 529 because it has their names on the accounts. This is a reminder for me when I get antsy and want to buy something big, and look for available money. A mutual fund in my name would be more likely to get tapped into versus these accounts.


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Bone Collector

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I don't know anything about the 529. I would do a mutual fund, as if the market is good, you can make good gains, and while the market goes down, it always comes back up.
 
UPSman

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We started a 529 account with USAA within a week of my daughter being born. She starts college this summer and has been doing dual enrollment classes her whole senior year. Right now, we have more than enough to pay for her tuition at UT Knoxville.
 
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Jon54

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Have you saved enough for your own retirement? If not, I’d save as much as I could. While every parent would like for their son to have enough $ put away for their kids, it’s difficult to save enough with the escalating cost of college.
 
TRIGGER

TRIGGER

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Jon54":o55cu553 said:
Have you saved enough for your own retirement? If not, I’d save as much as I could. While every parent would like for their son to have enough $ put away for their kids, it’s difficult to save enough with the escalating cost of college.

My father Set me up with an IRA when I was 18 and I have been making maximum contributions every year since(I’m 35 now). How much is “enough” when it comes to retirement? I’m self employed.
 
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poorhunter

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Go to Finacial Issues dot org and become a member for $85 and you'll get all your answers. I would set it up in a separate investment account in your name, knowing it is for your son. Then if your son doesn't need to go to college he can use that money for whatever he chooses without penalty. I think the 529 plans have penalties if you use it for something else.
 
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jb3

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Both my boys have a 529 account that was opened after they were born. But since this account can only be used for education, we've started saving in our retirement more. We've talked about opening up a mutual fund that they can use for education, but what they don't use, they can have the remaining to get their lives started.
 
Crappieaddict

Crappieaddict

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A 529 plan that is used for college expenses will grow tax/capital gains free. 529 plans are state specific, but you don’t have to use your state’s plan (I.e. TN). If all is not used for a college education, it can be transferred to a new beneficiary, for example, another child. Contributions are not tax deductible, like an IRA, but 18 years of tax free growth can be huge!
I’m here to try to learn more about deer hunting, as a total newbie. Finally, a topic that I know about!
 
fairchaser

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jb3":2zh611cq said:
Both my boys have a 529 account that was opened after they were born. But since this account can only be used for education, we've started saving in our retirement more. We've talked about opening up a mutual fund that they can use for education, but what they don't use, they can have the remaining to get their lives started.

Another choice would be to open a UTMA account which is simply an account in their name with you as the custodian. The advantage is that any income that it generates goes to them. Usually too small to even file a return. Any of the money should be used for their benefit but doesn’t have to be used for college like a 529 plan. It becomes there money once they reach adulthood.
 
pressfit

pressfit

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Buy a farm to hunt on.. set it up to pay off the year he starts school.. it's not going to loose value and you get years of use out of it instead of the broker getting a extra few trips to the Caribbean..
 
Shooter77

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In 2011 when my son was 1, I went to a Certified Financial Planner to open a college fund. He was young guy with kid on the way and he showed me what he was doing for when his girl was born. We mirrored his plan and I've been happy with the results. He did a cost break down sheet for UT-Knox and ETSU and what I would need based on inflation of college when my son started to pay for tuition, books, room & food on the meal plan. UT I needed to put 638.00 a month into the account and ETSU would need around 440.00 till my son finished his freshman year. I laughed and said I will do 100.00 a month. After my daughter was born 4 years ago, I split the 100 and put 50 into each account. He had a couple that wanted to send their twins to their private christian college they graduated from, they would have to put 1K per kid into the fund to pay for it... :shock: Said they couple passed on that amount and put 150 a month into the accounts. It's worth talking to financial planner about these things.
 
Shooter77

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fairchaser":2tuy20vc said:
jb3":2tuy20vc said:
Both my boys have a 529 account that was opened after they were born. But since this account can only be used for education, we've started saving in our retirement more. We've talked about opening up a mutual fund that they can use for education, but what they don't use, they can have the remaining to get their lives started.

Another choice would be to open a UTMA account which is simply an account in their name with you as the custodian. The advantage is that any income that it generates goes to them. Usually too small to even file a return. Any of the money should be used for their benefit but doesn’t have to be used for college like a 529 plan. It becomes there money once they reach adulthood.

I have a UTMA account for each of my kids open at the credit union that we put any money the kids get into it. My 7 y/o son has almost 6K and my 4 y/o has almost 3K in hers. I would expect them to have around 10k each when they graduate HS. If they are troubled kids in HS, I'll pull the money from it and not let them have it...lol
 
DaveB

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I had 3 kids in 14 months.....College scared me badly. In late 1990's I started with Long term C:D's but got out of them as soon as I could.

Then I opened a self-directed 401K with POST TAX money only.

For 8 years every pay raise most of the bonus money, and spare cash went into that 401K.

I pulled out of the market and 100% into cash on several occasions, like I was out in 2007 and not back until 2012 ....Back in using a very aggressive investment plan......My finance guy is AMERPRISE.

I have enough for all my offspring to attend College in Tennessee. If necessary, I have relatives in Florida my kids can live with until they qualify for that state, same for
California.

Out-of-state tuition charges are insane. You would need to work the boulevard.
 
huntinkev

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Shooter77":1yj1x1aw said:
In 2011 when my son was 1, I went to a Certified Financial Planner to open a college fund. He was young guy with kid on the way and he showed me what he was doing for when his girl was born. We mirrored his plan and I've been happy with the results. He did a cost break down sheet for UT-Knox and ETSU and what I would need based on inflation of college when my son started to pay for tuition, books, room & food on the meal plan. UT I needed to put 638.00 a month into the account and ETSU would need around 440.00 till my son finished his freshman year. I laughed and said I will do 100.00 a month. After my daughter was born 4 years ago, I split the 100 and put 50 into each account. He had a couple that wanted to send their twins to their private christian college they graduated from, they would have to put 1K per kid into the fund to pay for it... :shock: Said they couple passed on that amount and put 150 a month into the accounts. It's worth talking to financial planner about these things.

$638 a month. That's $138,000 just in contributions, not to mention any gains. Is UT really that much for a 4 yr degree now?
 
Shooter77

Shooter77

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huntinkev":2rhaz6ug said:
Shooter77":2rhaz6ug said:
In 2011 when my son was 1, I went to a Certified Financial Planner to open a college fund. He was young guy with kid on the way and he showed me what he was doing for when his girl was born. We mirrored his plan and I've been happy with the results. He did a cost break down sheet for UT-Knox and ETSU and what I would need based on inflation of college when my son started to pay for tuition, books, room & food on the meal plan. UT I needed to put 638.00 a month into the account and ETSU would need around 440.00 till my son finished his freshman year. I laughed and said I will do 100.00 a month. After my daughter was born 4 years ago, I split the 100 and put 50 into each account. He had a couple that wanted to send their twins to their private christian college they graduated from, they would have to put 1K per kid into the fund to pay for it... :shock: Said they couple passed on that amount and put 150 a month into the accounts. It's worth talking to financial planner about these things.

$638 a month. That's $138,000 just in contributions, not to mention any gains. Is UT really that much for a 4 yr degree now?

Based on the "Avg 7%" increase every year. I've seen it go up 11 & 15% a year when I went. Nothing like buying 175.00 book to use for one semester and then it not being used again and you get 5.00 back..lol he had it that when he entered the school in 2028 as a freshman and being there 4 years would be over 500K. I think ETSU was about 300K for the same thing. I will see if i can find he break down sheet and post it.
 
J

jb3

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UTK is probably around 30k a year. In 15 years there's no telling what it will cost. I keep telling my kids to make good grades and good decisions. My kids may go a different path than college but we're preparing for it. Fingers crossed the hope scholarship is still around which will take a little bite out of college as well as my wife being a teacher which I believe is a 25% discount for state schools.
 
Good time Charlie

Good time Charlie

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Crappieaddict":3t476efn said:
A 529 plan that is used for college expenses will grow tax/capital gains free. 529 plans are state specific, but you don’t have to use your state’s plan (I.e. TN). If all is not used for a college education, it can be transferred to a new beneficiary, for example, another child. Contributions are not tax deductible, like an IRA, but 18 years of tax free growth can be huge!
I’m here to try to learn more about deer hunting, as a total newbie. Finally, a topic that I know about!


I would just like to welcome you to this campfire....Just jump in where you see fit.
 
MUP

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Good time Charlie":1rntualo said:
Crappieaddict":1rntualo said:
A 529 plan that is used for college expenses will grow tax/capital gains free. 529 plans are state specific, but you don’t have to use your state’s plan (I.e. TN). If all is not used for a college education, it can be transferred to a new beneficiary, for example, another child. Contributions are not tax deductible, like an IRA, but 18 years of tax free growth can be huge!
I’m here to try to learn more about deer hunting, as a total newbie. Finally, a topic that I know about!


I would just like to welcome you to this campfire....Just jump in where you see fit.

:super: Welcome aboard!
 
Shooter77

Shooter77

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Crappieaddict":244k5uwf said:
A 529 plan that is used for college expenses will grow tax/capital gains free. 529 plans are state specific, but you don’t have to use your state’s plan (I.e. TN). If all is not used for a college education, it can be transferred to a new beneficiary, for example, another child. Contributions are not tax deductible, like an IRA, but 18 years of tax free growth can be huge!
I’m here to try to learn more about deer hunting, as a total newbie. Finally, a topic that I know about!

Welcome to the board! This is why I set up one for my kids because it can be transfered.
 

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