College Savings

[seven-up]

I'm looking at saving for my daughter's college. I'm thinking the 529 plan is a good route to go. Any ideas on which plan would be best? I am in Louisiana, which offers a small match each year based on your income. But I'm wanting to compare to others as well. Any suggestions are appreciated.

 

[Scotty342]

Morningstar puts out an annual list that is very good. If you aren't going with an option in Louisiana, I would look to one of the Gold medalists listed there:
http://finance.yahoo.com/news/morningstar-names-best-529-college-050000011.html

By staying in Louisiana, it looks like you get a 2%-14% earnings enhancement and a state tax deduction up to $4,800 per year. I haven't put any numbers to it but my guess is an out of state plan would be hard-pressed to beat those in state benefits.

 

[Matt]

Agreed- the final piece of the puzzle would be annual admin costs, and vanguard administers this so you are all good.

With running numbers, I'd imagine this plan is top 5 if not higher out of all plans (note its state specific so if another has a better plan, you couldn't get that benefit anyway)

 

[Robby Stephenson]

Agreed- the final piece of the puzzle would be annual admin costs, and vanguard administers this so you are all good.

With running numbers, I'd imagine this plan is top 5 if not higher out of all plans (note its state specific so if another has a better plan, you couldn't get that benefit anyway)

I went through the same calculation and thought process this year for us saving for our son. Virginia is a silver-tier in the Morningstar list, but with the state tax deduction and using the direct Invest with Vanguard, I have high confidence this is the best option for us.

 

[Matt]

I went through the same calculation and thought process this year for us saving for our son. Virginia is a silver-tier in the Morningstar list, but with the state tax deduction and using the direct Invest with Vanguard, I have high confidence this is the best option for us.

Cool- btw I only glanced at morningstar but am not sure how much stock input in their gold/silver/bronze charts.

The decision is pretty simple- if you live in a state that offers some sort of benefit- such as deduction, credit or boost then you are set. If not you need to hunt the lowest priced fees.

 

[Sesq]

The decision is pretty simple- if you live in a state that offers some sort of benefit- such as deduction, credit or boost then you are set. If not you need to hunt the lowest priced fees.

Or, as a hybrid, if your state has a capped deduction (say 3500), fund the state plan to the cap, then go to the low cost options (NY (shockingly), Utah, Nevada are all worth a look) if you plan to contribute more.

 

[seven-up]

Thank you all for the insight.