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CookiePuss
Cake from Outer Space!
Member since 5/05 14021 total posts
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Re: Has anyone set up a savings account or anything for the baby?
Posted by chelle
Posted by lvdolphins
This thread was so helpful! Thank You so much for starting it.
You are most welcome!  I just figured that it's an important thing to do now. Thankfully DH already has a good retirement plan going through his work, so we'll be ok... so we're able to think about the kids first on this one. I just want them to have something when they're old enough and we're trying to figure out what the best way to do that is.
So far the ING account sounds like what we're going to go for.
Can we roll that over into a 529 plan??
Yes. The ING account; Orange, is just a savings account.
One thing to consider is how you will title the account. If you open the savings account as a UTMA, it is an irrevocable gift to the minor so when you use that to open a 529 plan, the 529 plan also has to be a UTMA minor account and is now limited in what you can use the funds for without tax and in some cases, a penalty. For instance, you can't take money out of a UTMA 529 plan to help buy a car for that child. Also, that money in the 529 UTMA account can not be used for any other beneficiary so other children can't use the funds even if there are "extra."
FM me if you have any specific questions. I'm happy to help.
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Posted 1/9/07 10:38 AM  |
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chelle
It's a Good Life
Member since 8/06 15404 total posts
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Isn't it obvious?
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Re: Has anyone set up a savings account or anything for the baby?
Thank you!!!
I think we'll set up the ING savings in our name 1st. Then.... when we have the baby, change it to their name. I don't want it to be specifically for college.
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| Posted 1/9/07 10:40 AM |
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karacg
Babygirl is 4!
Member since 5/05 17076 total posts
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Kara®
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Re: Has anyone set up a savings account or anything for the baby?
You can change the name on the 529 from your name to baby's name...that's what we will do. If you don't want to save specifically for education that may not be the right plan.
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| Posted 1/9/07 10:43 AM |
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CookiePuss
Cake from Outer Space!
Member since 5/05 14021 total posts
Name:
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Re: Has anyone set up a savings account or anything for the baby?
Posted by karacg
You can change the name on the 529 from your name to baby's name...that's what we will do. If you don't want to save specifically for education that may not be the right plan.
That is true as long as it is not an UTMA account ( uniform transfer to minor) because it is considered an irrevocable gift. As long as it in not set up that way, you can always change the beneficiary.
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| Posted 1/9/07 10:57 AM |
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CookiePuss
Cake from Outer Space!
Member since 5/05 14021 total posts
Name:
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Re: Has anyone set up a savings account or anything for the baby?
Posted by chelle
Thank you!!!
I think we'll set up the ING savings in our name 1st. Then.... when we have the baby, change it to their name. I don't want it to be specifically for college.
No need to change it into their names, necessarily. Plus, you can have both a 529 plan and a "fun" account at the same time. That is what I have. I put Molly's birthday, holiday, misc money into a savings account in her name. That way she can use it for whatever she wants. I also have a 529 plan with her as the beneficiary. There can be some tax benefits to the 529 plan depending what state you live in, that go above and beyond the tax deferral and/or tax free withdrawals.
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| Posted 1/9/07 11:00 AM |
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steph4777
**************
Member since 5/05 11726 total posts
Name:
Stephanie
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Re: Has anyone set up a savings account or anything for the baby?
FYI.... the Citibank e-savings account is offering 5% interest. We decided to open one up instead of ING, plus we also bank with them so it was easier.
Citibank e-savings
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| Posted 1/9/07 11:04 AM |
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chelle
It's a Good Life
Member since 8/06 15404 total posts
Name:
Isn't it obvious?
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Re: Has anyone set up a savings account or anything for the baby?
We've decided to open a money market account that will earn a 7% interest rate for the year. We can put money in whenever throughout the year and it will still earn a 7% rate. After the year, we'll transfer the balance into something.
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| Posted 1/9/07 11:05 AM |
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