Saving suggestions

[#1]

Hi,

I am planning to start investing in a 529 plan for my daughter's college education.

Does anyone know of a 529 plan that works well in Colorado and if necessary elsewhere in US? Website information would be great.

Basically, I'd like to be able to pay for my daughter's college expenses if she joins a University here in Colorado or elsewhere in US.

This is the first time I'm investing in a 529 plan and don't have much idea on how it works. So, please advise if I should know of anything else before I sign-on to a 529 plan.

Thanks,
Sri

[#2]

Not sure what type of 529 accounts Upromise offers but check out www.saveforlater.net. There is a save page with different states that offer savings programs. I currently have prepaid college for my kids but we live in Florida, where they offer both a 529 plan and a prepaid plan. See what you find and if you don't find anything there just do a search online for 529's and see if you can find something better (maybe a private investment co) might have something.

[#3]

In general, any plan will work, but some are better than others.  Some states have tax benefits associated with the specific state plan.  There are a limited number to which you can automatically transfer your Upromise savings, but you can submit a check withdrawal request and have the funds sent directly to you for deposit into your college savings plan.

Check out http://www.savingforcollege.com/.  It is a comprehensive college planning site and rates all available 529 plans (some 115 total), both from a resident and non-resident perspective, and provides all the details you could want to know, from fees to program manager to how to invest.  For Colorado, it lists 4 plans, 3 of which are open to new participants.

[#4]

Essentially 529 plans are jumbo mutual fund accounts. Im my experience, 529 plans are used more as a supplement for college education unless funded properly. I use a 529 plan for my daughter, but I also have an insurance policy on her so if she decides on an alternative to college, or receives a full scholarship then she can use that money without financial penalties. I would take a look at the laws in Colorado to see if  they restrict accessing the money in those accounts. There are alternatives out there that do not "handcuff" how and when you can access your money and are also not tied to the market. I hope this helps.

[#5]

This helped me understand:

You can live in state A, your child in state B, his grandma from state C can send a check to fund his 529 account in state D, the money from which he can use to attend school in state E.

But check your state plans first to see if you can get any tax advantages locally as a resident.