Re: How much for college?
Regarding the kids' money, if it's legitimately their money (e.g., bday or Christmas gifts) I put it in an UGMA in their name. If they want to blow it on a car or a trip to Europe when they're 18, it really is their money and I have no right to dictate how to use it (imo). For money I'm saving for their college, I put it in a 529 account for each of them. You need to check each specific plan for details, but we use NY's. We can deduct up to $10,000 of contributions on our state taxes each year, and if one of them doesn't need the money, it can be transferred to the other, used for grad school, etc. If your child gets a scholarship, some plans allow you to withdraw that amount of money from the 529 penalty free. Although we contribute each month to the 529, my plan is to increase the contribution once my little guy is out of preschool (Jun 06). That's a few hundred dollars extra right there!
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