Families and 529s
Dochas
member
Would you be comfortable with a family member making regular contributions to your child's 529 plan.
My sister and bil asked for my son's info. Honestly - they are the ones who encouraged us to open one. I hadn't planned on it because I know that we can't/won't make large, regular contributions. But I decided that every little bit will help when the time comes so I opened one. I thought they would make an occasional, small deposit. But my BIL set up a monthly contribution of $50. May not seem like a lot, but makes me a little uncomfortable, but since I am uncomfortable with taking anything from anyone I know I am overreacting. Facts - yes they can well afford it. And in their position I would do the same thing. Wondering how other would feel. Thanks!
Re: Families and 529s
BIL specifically asked me to open it because he would not qualify for a tax deduction. He thought if we opened it we would qualify for our contributions. It's NJ though so no deduction for anyone at this time. I would have been fine with them opening it and would give them access to see the account but they have no interest so really no strings, they don't want any control. And they know I would NEVER touch his money under any circumstances anyway.
It really is a good idea. It wouldn't have worked in our family for many reasons.
One brother is vocal and adamant about not paying for college. We likely aren't either but he wears it like a badge of honor. Another brother has a spending problem and when my mother would give checks for birthdays it would come back stamped from their mortgage carrier. I would never have given them money -when we gave bonds it was in sole ownership of child's name (SILs mother even complained about that once because she couldn't cash it!) One sister is crazy rich. The other 2 sisters would have gone for it though!
Thank you! And great to hear it isn't uncommon!
Sure! LOL If they offer, why not?
It seems like you have an awesome relationship here and I really don't see an issue with it. I don't like taking money from people either BUT if someone wants to bless you I think it's flat out rude to refuse. As long as it's a no strings attached thing it really sounds like a great thing.
What!?! I think it's awesome! If my in-laws did that for either of my kids, I would be thrilled.
It depends on who it is. My parents are very well off and very generous and it's always no-strings attached. So if they wanted to contribute annually, I would have no problem with it.
C 7.16.2008 | L 11.12.2010 | A 3.18.2013
This is such a wonderful gift ... we've been trying to encourage our extended family to set up 529s for DS (he is the only grandchild on both sides). Especially since we now live abroad and the postage to ship material gifts is ridiculous.
Just think about how expensive college is going to be for this generation of babies ... it will be such a relief for your son to have this money. It could make the difference in what school he chooses to attend, or whether or not he has debt when he graduates. And if he doesn't use it, then the account that your sister and BIL set up still belongs to them, if I understand correctly they could use it for their own continuing ed down the road if the primary beneficiary doesn't use it up.