Posted by Madison on November 6, 2007
I recently covered how to open a 529 college savings plan. I revealed that we have multiple plans for our children. We currently have six accounts in five different states. Here’s a summary of which states we have an account at and why:
- The UNIQUE Plan in New Hampshire. This plan has an attached credit card that earns 2% cashback deposited directly into the account. However, while we were grandfathered in, the credit card has since been downgraded to 1.5% cashback for new cardholders.
- The College Savings plan in Iowa is a low cost recipient of automatic Upromise contributions.
- The Edvest plan in Wisconsin is for the purpose of state tax deductions for us and grandparents that are contributing.
- Finally, the College Advantage plan in Ohio, which is my favorite because of the investment options and low expense ratios. This plan holds the majority of our investment dollars.
In addition to our own children, we also have opened accounts for family members that we contribute to on their birthdays and holidays at:
- The Scholarshare plan in California. This plan features a low cost to open, without needing monthly contributions to avoid maintenance fees and often features sign-up bonuses. We have opened roughly a dozen accounts here and received many gift cards to Target.
I look at all the accounts for our children as one portfolio and manage our asset allocation accordingly.
For more information on these and other state 529 plans see savingforcollege.com.
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Why do you have so many different plans?
@FiveCentNickel: If I had to choose only one plan, it would be the Ohio plan. All the other plans are open just to receive free money: cashback on our credit card, Upromise contributions and our state tax deduction. I usually roll all the money into the Ohio plan at the end of the year.
Great post! I’ll forward a link to all of my grown daughters so they can think about how they are funding the grand kids college accounts.
Can you open a 529 plan for a child that does not yet exist?
@ Mike: Absolutely! We opened many of these before our children were born. You can list yourself as the beneficiary and change it to your child after they are born.
I’m a CA resident and also went with the Ohio plan because of it’s low costs and Vanguard investment options. But CA does not offer a tax deductions for contributions.
I suggest to your readers that they look at their own State’s plans for possible tax deductions on contributions first before considering out-of-state plans.