Im looking for a plan so i can pay college to my kids, from now on, they are 5, 8 , 13 years old?
Question:
so you can pay in advance.
the 13 one is always High Honor Roll
Answer:
Yeah, you can't pay the college in advance. However, I also agree with the 529 plan. Also, if you live in a state with a good public university (California, Michigan, North Carolina, Wisconsin, Virginia, Illinois, and Washington), then consider those state universities since their tuitions tend to be way cheaper.
I think the best possible way would be to look into Section 529 plans. They are specifically designed for education savings. The amounts that are earned within the accounts are tax free, and any withdrawals made to pay for your child's education are also tax free. If you end up with more in the account than you saved (good luck with that one!), you can transfer the account to a sibling, or for that matter, even yourself. Some states even offer a tax break for opening a Sec 529 based in your home state.
Another advantage of the 529 plans is that currently, they aren't included as an asset when trying to calculate available financial aid. That could potentially change by the time your 13 year old gets to college, but it's something to consider.
There are some good online resources to find the best 529 plans, so take a look online before choosing one.
The reason I'm suggesting the 529 instead of prepaying a university is because it would be unfortunate to have your money locked in at a particular school if you child changes his/her mind about attending that university. I know from my nephews that they agonized over which school would best suit their very specialized majors. My oldest nephew was totally set on one particular school, then another school of equal quality offered him a partial scholarship. So, the moral of the story is that sometimes it's not a good thing to lock your money into one school.
Hope that helps!
This is what my parents did. As soon as I was born my parents made a college savings account. And every week they would deposit $100 into my savings account for college. I was not allowed to touch that money what so ever. And as soon as I got admitted into my university that money went to pay for my college tuition. Do that math and that is a lot of money that accumalated over the years. Now im a Junior in college and with the help of my parents I dont have any debts or loans. Thankfully, I came from an affluent family so money was never an issue but try reserving money for your childs college tuition asap. Thats what I plan on doing as well.
Invest in GOVERNMENT SAVING BONDS The I bond series is specifically for education. All interest incured is tax free if they are used for education. They are paying about 7 % at present . Better than any bank or CD. And they are safe investment. If you did not have a government you would be in no need for money.
don't give your money to a college to use for that many years. Make your money work for you. They come in 25, 50,100 ect and you can obtain and or cash them at any bank.
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