#211 – Maximizing 529 Plans: Tax Benefits and Best Practices (Part2)

Well, how much are you willing to lose or gain right it because market will fluctuate when you invest in these accounts, you usually invest in markets like the stock market, the bond market, some fun some options have real estate market. So it's it's really like that combination, they most of these plans, have an option for you to take a short quiz that can help you decide like here's my risk tolerance profile and I'm going to select these options because it's not enough to just say I want low cost funds like Vanguard, I want you know, more passive index funds versus oak I'm interested in companies that invest in socially responsible investments or No, I just want to be really conservative with my money. And I want to put it in, in CDs, for example, or something like a savings type of an account. So it really comes down to how much I would suggest for you to think about how much time you have. And you know, one thing is, the more time you have, the more risk you should be willing to take because you have time to recoup and grow your money. And to this is why looking at the investment plan, and the options that exist for that plan is really crucial at the beginning, because you will have all of those answers kind of checked off for you once you make a selection. So one thing I wanted to mention too, again, I'm on Instagram a lot and I would love for you to connect and chat with me there many boss parent sent me word college, and I will share with you one of the tools I love to use with clients. It's a really nifty calculator from the Vanguard site that allows you to kind of really get clear on like, Okay, here's how much money you need to be saving if you had a particular school in mind. So you will be able to figure out what you actually needing to do. So if you have a five year old, like I do, almost five year old, then you need to save X amount of dollars. So sent me word College, and I'm happy to share that calculator with you. Because I think it's kinda like the first first thing, one of the first things to do is to get that out of the way. And lastly, I want to just share just a few tips and best practices of once you get that started and, you know, select your plan, pick the investments, know what your target is for savings, some some of the ideas, how do you sort of stay on track with with this? I haven't quite gotten to that yet. But I think now that Liam is starting to be more interested in in finances, and asking questions about money was started the savings jars, I'm gonna start to introduce this concept of college and saving for it. But I think this is maybe for kids that are a little bit older, where you can actually involve them and explain to them, here's what's happening. Here's what mom and dad are doing. Here's, you know why we're doing it. So like involving them in the process, I think is really important because they they should be learning this as they go that hopefully will help them shape their decisions about you know, what they want to do and how all of this comes together. I think it also teaches financial responsibility, right? If we're taking these steps. As a family, I want to have I want to be upfront, I want to be open book, I want to be talking about these things because I maybe that's just my background, where I come from, but I there's nothing to be ashamed of. There's nothing to be hiding. And so that's why I'm talking to you and encouraging you to start doing these things as soon as you actually can. And at the same time, like avoiding mistakes. And I mentioned to you like this, this is an investment. This is the one of the biggest investments you're going to make in your life, right aside from saving for your own retirement. And so I just feel like just starting an account, putting some money in it and not really paying attention to it is not a good strategy. Like, I want you to be coming back to it to it at least once a year, rethinking and still kind of asking the question, Where are we still on track. And we're still thinking that our child is going to, you know, go to a state school where we are or like if you get closer, right, like once you have teenagers, you really are paying more attention. Not that they're older, what kind of humans are they? What are they interested in? And if you have to make adjustments to these, I've had clients this is interesting, actually fact too. I've had clients who, over time, right, because they started early, they were consistent, contributed every time or every time they could, they were able to like front and pre fund these accounts even before their kids turn 18. So I mean, I've seen how awesome that is to be to be like ready and check off that box even before you actually have to use those accounts. So I highly suggest to make this one of the things that you review once a year on your financial statements or balance sheet. And keep asking questions as a family if that's the target we still have on our on our books. And if we still have the budget in options to do that. And don't forget to ask those grandparents for four or 529 college money because I promise you, they don't need twice as much as we think or as much as they want him. So that's it my friends. There's a lot more to talk about when it comes to these accounts. Since I want you to start, I want you to start somewhere, we will have more discussions, I promise you there's, there's more to cover, but just start just start somewhere, if you haven't yet, it's going to over time, it's going to become sort of a second habit and one of the extra things that you saving, and it feels good, it really does feel good. Once you look back now that I have almost five years under my belt as a mom, it feels good knowing that I'm taking the right steps. And don't beat yourself up. If you haven't started yet. And your kids are older. That's okay, just start now, I know that for sure. And some of it is from my pep talk who used to give to parent groups and at fairs that I did for in my early career from Maryland 529 college plan, I kind of missed those conversations. I think I get them now. So many years later, but that's just how life goes. I appreciate you tuning in. If you have 30 seconds of your time, I would really be grateful if you left us a review subscribed and shared with the friends. Because without you I couldn't be doing this. There's no point of doing this. And I very much appreciate hearing from you. Getting your thoughts and feedback. Also, let me know if there are topics you want me to cover on this podcast because it's always it's always something that comes from listeners like yourself that make my day excited and even, you know, even planning this podcast for next year would be awesome too. So thanks so much for tuning in. And remember You are the bosses of your own money.