You are correct. Thank you for that. Depending on where you live, your state may allow a portion of contributions to be tax exempt.
The biggest state does not. I live in the biggest state.
You are correct. Thank you for that. Depending on where you live, your state may allow a portion of contributions to be tax exempt.
This really hurts people in California, as we already had free community college for the middle and lower income people.
Obama's proposal extends free community college to everybody, iirc. I don't understand how anybody is losing in that regard.
Oh you are such beyond hope, lol. They should make vegetables free. For the health benefits you know?
Obama's proposal extends free community college to everybody, iirc. I don't understand how anybody is losing in that regard.
The changes are proposed, they don't exist yet.Before the change their was some reason for people in California to invest in a 529 plan and now their is none. It offers nothing that simply investing directly doesn't offer. There is no reason for it.
I think his complaint is more about how they aren't gaining anything. He's angry about missing out on the gravy train.
Fern
I think his complaint is more about how they aren't gaining anything. He's angry about missing out on the gravy train.
Fern
How is this better than a Roth IRA which grows tax free, and isn't subject to capital gains tax. A Roth IRA can also be used on education, as well as having the advantage of not counting against your fafsa, unlike 529 whixh count against your financial aid.
Um free vegetables would cause a shortage of vegetables ironically by screwing up the supply and demand curve, but I was just having fun watching it predictably go woosh over his head, honestly.
First and foremost, according to what I'm reading this would only apply to new contributions. Therefore, everyone worried about them changing the rules of the game on you were wrong.
Considering we have 14 years until my daughter potentially goes to college, I'm not sure why you'd think I shouldn't be concerned, or others be concerned about the implied change to 529's.
That is all fine and dandy except people were sold on it being tax free. Now Obama wants to tax it. Regardless of how many get dinged. It is immoral for a program to be sold for decades on a premise. Then to yank away its premise to pay for something else.
There it is again. Someone who can afford to pay out of pocket $60K/year for college and has over $1.2 million in savings thinks he is middle class.
You are correct. Thank you for that. Depending on where you live, your state may allow a portion of contributions to be tax exempt.
Because they're still a tax advantaged way to invest above and beyond IRA's, 401K's & so forth. I rather suspect that those who use 'em, for the most part, also max out their other methods as well.
Shelters are a method of estate planning. None of them are stupid to use, although some are more valuable than others.To save for education yes. 529's are not a standard investment vehicle... ie; don't use it for education and cash out... the penalty isn't worth it. A 529 as some sort of shelter is pretty stupid unless you want to contribute $14k a year to your kid's college fund assuming they are going to go to the most expensive school for the most expensive degree.
Note that if community colleges were free like Obama is also proposing, that would already save anyone willing to go to one for two years before transferring to a state school something like $24k/yr x 2 = $48k. That's a conservative estimate, could easily be $60k+. 529 plans would be far less important (though still useful).
How is this better than a Roth IRA which grows tax free, and isn't subject to capital gains tax. A Roth IRA can also be used on education, as well as having the advantage of not counting against your fafsa, unlike 529 whixh count against your financial aid.
Considering I have no kids, I really don't care to much honestly, other than I see a free salad might be involved somewhere.
More of my tax dollars I can't delegate somewhere I don't care about.
Shelters are a method of estate planning. None of them are stupid to use, although some are more valuable than others.
Part of estate planning is if you have millions of dollars, you want to "give away" as much as possible to people you want to have your money. If you do it right and use shelters, you can give away a lot more without paying taxes on it.
Another part, for the non-rich, is to get money to a relative/friend without it having to go through probate, which happens whether you die with a will or not.
http://www.savingforcollege.com/int...ift-and-estate-tax-benefits-for-529-plans.php
I think 529s should remain as they are. Also, I highly doubt that the proposed changes actually occur. And, if they don't, perhaps middle class people who should be using them will be slightly more inclined to learn about them and actually start using them in larger numbers.Quite frankly, if you are that rich you set up an off shore family trust and call it done... Ala The Kennedy Family.
Yes, I get your point... In those cases the penalty is moot as you are still able to give it away and obscure it from the rest of the estate.
That said, I highly doubt the middle class or the upper middle class is even in the league to do that with a 529.