How to wisely use 529 for pre-college tuition?

[msomnipotent]

So how if she was on payment plan paying interest did she get the money to lump sum into a 529 and then pull it out? If you didn't have $10k to begin with where did it come from to put money in to pull out?

I broke down the numbers above. I guess but how much do you really make because most don't advocate investing in the stock market if you are pulling the money in the year.

I mean what you are writing doesn't make sense.

I would have to have $10k to put in before I need it say August 2018. But where did the money come from if I was only making payments for private school before?

Then in 8 months it's going to grow a lot? What about the payments for 2017-2018 I was making? Did I not make them?

If I had the $10k lump sum why was I paying interest? What your saying doesn't make sense unless something isn't panning out. Either you had the money and saved all year to pay in August 2018. And were a year ahead. Or you were making payment plan throughout 2017-2018 if so how are you avoiding interest by having a 529?

And why are you investing in a 529 into the stock market if you are pulling it out in less than 12 months?

You don't need a lump sum to start a 529 plan. She didn't open the 529 yet as she is still asking questions, and I have stated earlier that it will take about a year for her to fully fund the 529's to pay for private tuition and have something left over for college savings. She is almost done with paying for this tuition year, so she is planning for next year.

I'm not sure why my posts are not making sense to you. All I can say is that she will be making the same payments she was making to the school, only to her 529's. Instead of paying interest, she will be getting a tax deduction. She doesn't need to chase returns to get ahead because the tax deductions are already putting her ahead. Our state has many options and a few that are very low risk. She does have a savings account that she can access if things go south, and how low can a conservative account really go? Maybe 10%? I'm sure she can come up with $1,000 or borrow from family. She is middle class, not poor.

What it boils down to is that you said this is a tax break for the rich. I said it is not because the income limits phase out to exclude high earners. Then I gave a specific example of how this is going to help an middle class person to prove my point that this is a tax break for the middle class. It really doesn't matter that it isn't a windfall amount. I got about $300 back on my state taxes last year for contributing to a 529. That's still $300 I wasn't going to have before. Even an extra $5 is still a tax break.