college savings

[jdbuckshot]

Was planning on buying a jeep this summer to ride around with the top down and check trail cameras, hit dirt roads and later afternoon fishing holes.

instead i figure its time to be responsible and take that money and start planning.

Looking at MACS and IMPACT programs - my mom did this for me and it has been a blessing to help me and my wife get on the road to success.


i am not investment savy at all. i understand it, and i do have investments but i do not follow the stock market at all other than looking at my 401k about once a year.

any other programs out there that are good college savings accounts???

[Smoke68]

I'm doing a 529 College Savings, which is MACS in Mississippi. I'm actually using the Virginia version of the 529 plan. You are not limited to just Mississippi. It grows tax free (but the investment is after taxes) and can be used not only for tuition, but also books, supplies, and rent.

The main difference is that I'm using the stock market to grow my investment to pay for what school will cost in the future. With the MPACT, one is simply paying today's actual tuition cost for future schooling. If you want to go to an out-of-state or private school, MPACT will only pay the MS public school cost of tuition.

I don't think one is going to have a major advantage over the other. The investment will grow over 18-20 years, and tuition costs will increase. If you decide to do MPACT, you can sign up yourself. If you decide to go the 529 route (MACS or some other state's 529) you'll need to do a little more research on what type of investment to go with.

Good on you for setting aside toys and getting serious about the future.

[JLT]

I got with a reputable investment firm in Jackson and started my own investment based on their recommendations. When the money is needed there won't be anyone to tell me where I can use it or what I can use it on.

[Smoke68]

[JLT]

I do pay taxes on the earnings. I would assume that if a you don't big bro will have a say so in what you do with it? What happens if child choses not to go to college? My experience has been that the Gov't is gonna get theirs one way or the other.

[stang67]

Did the investment firm tell you these things? There are so many ways to get around any sort of penalty if the named child doesn't pursue "college." Heck, you can even leave the money there for a grandchild.

To the OP, do some googling. This stuff is pretty black and white.

[Smoke68]

Here's a quick and informative read: http://www.savingforcollege.com/article ... -529-plans

[420 racin]

We looked at this college savings stuff a while back and we decided to just set up another mutual fund along side our retirement ones, and that one will be for college. I didn't like the idea of Gov. telling me what I can and can't do with the money or either take a big hit on it. I know folks say there's ways around it and such, but I figure it'll be a long time before I have to use that money, and since the Gov. is always making more and more regulations and rules....I didn't want my money tied up behind those rules. If he goes to college Great he's covered, if he doesn't great he's got a good start at life. Not saying either way is better than any other, my financial planner and me and the wife decided this way is better for us, may not be for everyone

[stang67]

Why is one route safer from future .gov intervention than the other, in the planner's opinion?

[420 racin]

For me it has to do with the penalties for taking the money and using on something other than what they say are "authorized" for it to be used on. That is where I, this is just me, feel that "they" will or can get you. They say you can spend your money on college related things..or something like that...well "they" are the ones that determine what those "things" are. New legislature or laws or programs, etc... all will or could have an effect on what you may or may not elect to use your money on....for me, I see the Gov. getting more and more and more into peoples business and making more and more and more laws...I don't know what the situation will be like in 15 years or so, but I don't want my money tied up with any more rules or restrictions that it will already have on it.

[Smoke68]

I get what you guys are saying about wanting the government to stay out of your decisions on how to use the money. It's your call.

For those of you still deciding, just know that taking this route will COST you a significant amount of money in taxes over the long term, money that would have otherwise contributed to additional growth of the investment. Going this route of doing a straight up investment, all of the earnings are going to be taxed according to your income tax bracket and/or capital gains tax (15%).

For me, it's a no brainer. If you can keep the government's hands out of your cookie jar by following some rules, I say do it. Same thing applies to Roth IRAs and Health Savings Accounts.

[Deltaquack]

Depending on the age of your kids....do both if you can afford it.....and any amount is better than nothing. I currently do the MACS 529 plan for all 3 of my kids. I plan on doing Impact too for the younger 2 possibly starting this year. I started about 5 years ago putting a couple of hundred in our daughter's 529 (she was 12-13 yo at the time). I put 100 or 125 in each of my 2 sons'. They were 5 and 6 at the time. I just got a statement in the mail for all three this week. Our daughter's has over 40K in it.....and 2 sons have 20K each in theirs. They've been jumping with the market doing well. They've yet to lose any money either. You can move the money around amongst them as well. I can load hers up and what's left transfer into my sons' accounts if i want. When it's all said and done.....i can cash them out and pay income taxes on what i don't use.

As for Impact...i saw one explanation above. You can use it to go out of state......but will only get what MS Instate tuition is listed at the time.

The 529 can be used at any school....and like said earlier, can be used for books, rent, etc. i've heard of instances where vehicles were paid for where it was shown the student needed the vehicle to go to the school they attended.