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529 Plans - The Bad

November 8th, 2010 at 04:58 pm

10 Things 529 Providers Won't Tell You

http://www.smartmoney.com/spending/rip-offs/10-things-529-pr...

Hmmmm, and I can't help but feel this list is incomplete. I read recently that 529 plans were very restrictive in how much often you can buy/sell funds within the plan. (I do not know if this applies to ALL 529 plans, but the article I read seemed to hint that it did).

I recently said in the forums, that to point out the flaws of 529 plans used to be "blasphame," but lately, there is more media about the downsides.

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Not to say 529 plans don't have their place. I just think they generally have their place with wealth planning and higher net worth individuals.

I don't think the average person understands all the pitfalls, that is for sure. So I like seeing more of these articles.

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BTW, #4 is just plain stupid. Something like, "Save $100k and lose $5k of financial aid." Rolleyes Do you need $5k of financial aid if you saved up $100k for college?

But, I think #4 pointed out some other good things that most people don't understand about financial aid considerations.

1 Responses to “529 Plans - The Bad”

  1. Single Guy Says:

    Perhaps its because I am not in the situation where I would even want to use a 529 plan, but even at the beginning I had serious doubts about the usefulness of this saving strategy, and this article hit on my concerns and a few extras. Saving = good, but saving in 529 = adding risk for little benefit (IMO).

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