another thing I have done is KEEP TRACK

at the end of every month - without exception - for the last 22 years i print out a ONE page xcel spreadsheet with all the acct balances and major expenses on it.

hard copy - not electronic. I over-write the file every month. keep them in notebooks...

every month for 22 years.

I can pretty much tell you every major balance / expense / tax refund / etc to the month for the last 22 years

It has been a way to 'reality check' and see the ups and downs of our financial situation

this month for instance has been a downer - S&P 500 down around 6% but we're still up for the year...

another thing its cool to see easily - how are we end of MAy 2019 compared to end of May 2014 vs. end of May 2009...

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^^^^

Keeping track is fine as long as you don't panic and change things because you are down 6% this month.

Texas has some programs to fund college.
https://www.texastomorrowfunds.org/

We paid for our kids to attend college. We required that they go to a state school with instate tuition.

Then there’s ROTC

This may not be popular, but I'll give you this advice anyway.

If you can afford to support your kids through the better part of their adult life, then more power to you. Most people can't...and shouldn't.

Once they hit 18, your kids should be able to support themselves if you've raised them right. Does that mean that they'll go into some debt for college and living expenses? Yep.

Newsflash!!! That's not a bad thing!

I know people who are so foolish that they get a second mortgage on their homes to fund their childrens' college education. The only word I have for that is foolish.

Between myself, my six siblings, and three kids, all but one has a college degree, five of us have post-graduate/professional degrees, and all are successful...without a single dime of support from parents.

We, and millions before us, are evidence that it can be done and in my opinion, should be done.

18 year olds are adults. Give them the advice they need to be successful and kick them out of the nest.

I'm not saying don't help them out monetarily if they hit a rough spot, but they need to find their own way and they need to make their own way. They'll be better for it.

Age-based (risk decreases with age) 529 plan. Tax advantage is that growth/withdrawals are tax-free as long as they’re used for qualified education expenses (tuition, room & board) and, of course, jive at tax-time with the 1098-T form. You can have checks issued to the institution, and if/when they live off-campus you can have reimbursement checks issued to you for out-of-pocket room and board expenses (so long as they do not exceed what the university charges).

We’ve used ours the last two years as our kids complete their sophomore and junior years.

Best gift you can give your kids is eliminate or minimize their college debt so they can start off their life unhampered by debt right out of the starting gate...as long as you’re not putting yourself in debt and/or retirement at risk.. Since your question makes clear that’s not the case, congrats on planning well and planning early.

Three things about 529 plans that I don't believe have been mentioned:

1. 529 College Savings Plan and not a 529 Prepaid Tution Plan.
2. The funds can be used for the education expenses of certain relatives of the beneficiary without tax or penalty.
3. Up to $10,000 a year can be tapped for elementary education.

Number 2 is interesting. I have 3 children and each has a substantial amount in their 529 plan. If one goes to an in state school, there will likely be money left over. By changing the beneficiary, which the account owner can do at anytime, to a first cousin or closer relative to the beneficiary, you can still use the remaining funds for qualified education expenses without taxes or penalties.

Number 3 is nice if you have too much money in a 529 plan. It can happen. It's also nice in states that give deductions for 529 plan contributions.

quote:

Originally posted by trapper189:

1. 529 College Savings Plan and not a 529 Prepaid Tution Plan.

Yes, good point...I should have clarified that for the OP in my 529 post above yours.

As a financial specialist, I’ll tell you what I learned: the wedding will cost more than college. True.

Full disclosure, I work for TIAA.

Before you consider your daughter's college education, you need to ensure you are properly saving for retirement. 457b and 403b limits at your age are substantial. TIAA's lifecycle funds are some of the best in the industry. If you call the 800# at TIAA or visit a TIAA consultant at work they will help you with your other savings quetions. I am sure your work plan offers Advice through TIAA paid for by your employer, you should take advantage of it.

The forum is great but everyone here has opinions based on their own experience and circumstances, you need a professional to help you with your specific needs. TIAA consultants don't get paid commissions so they will be less biased in trying to sell you something.

Email is in my profile if you have questions...

I am not a finance pro by training, license, or profession. I do, however think that putting your money into a retirement package is a better investment than putting it into an education fund.

The reasoning is this: Your daughter will be able to borrow money for college if she needs to, however you will not be able to borrow money for retirement. I would put the funds into retirement or other investments that you control, and that are not dedicated solely to education. You can always liquidate non-qualified investments to help her with college, or if she borrows the money, you can help her pay the debt, but I don't think that putting money into education funding is a good idea unless you are already fully funding your other plans, OR you have a program in your state similar to Florida Pre Paid, where you can buy a full college education at the state schools for a fixed fee now, and she can use it later.

Pay down debt instead.

One really needs the comprehensive approach adjusted for individual particulars.

Would it make sense to carry credit card debt while putting $$ into a 529 plan? Of course not, generally speaking. Regardless, one can’t turn a heavy ship on a dime, but small changes can have good effect down the road(years).

Let’s say one puts $10k aside from the paycheck into a 401k(or similar) plan. You really are taking $8k or so, since about 20% would go to taxes. So starting off one is already well ahead of an investment outside a tax sheltered plan. The growth going forward is protected also.

One has to give consideration to the rest of the financial picture, could be a whole host of things.

Years back a relative asked for advice, she had 15+ years before any retirement. I gave just a bit, mild investment choices, after talking about particulars. Later on the investment was down about 4%, on a dip, nothing major. She then commented about how it was down, maybe it wasn’t a great choice?

Just an example about some that don’t have a mindset to what happens with investments & risks involved. Two of my favorites over the years have been the Capital Opportunity & Explorer Funds with Vanguard. They have averaged well, but one can’t be afraid of a down period.

Diversification based on time horizon, goals, & mental makeup should be key components in decisions.