What do you think about 529 accounts for young children?
Suze Orman: LOVE them!
What is the best account to start for a child? Should we look for ones that gain most money?
Suze Orman: The best account for a child is a 529 plan. Be very careful of UGMA [Uniform Gifts to Minors Act] accounts. For any money in a UGMA account is counted again the child's eligibility for financial aid. 529s are the way to go!
How should I save money for my son's college? Was wondering if you recommend the 529NY saves plan? And are there penalties on it when taken out?
Suze Orman: No penalties, no taxes! As long as it's used for the child's education.
We are a single family income and we have a 6-year-old. I am worried that we aren't able to save for his college yet. If we could find $20-$50/month to put away where would be the best place to put it?
Suze Orman: From the sounds of it, you should get life insurance to protect this child if something happened to you or your spouse if you're married. You also need a living, revocable trust, because minors can't inherit money. Please make sure you have protected them in every possible way if something were to go wrong. If you've done everything to protect them, use a 529 plan!
Suze Orman is a award winning certified financial planner and author of several books including 'The Road to Wealth'. She went from being a waitress at age 30, making $400 a month, to now having her own TV show and a net worth of $30 million dollars.
