our529plan
Tuition, housing, food, and books. Pick a grade and a target.
Pick one. Any of these three funds the target.
Same cost either way. Flat is set it once and forget it.
| Year | Grade | Projected 529 |
|---|
| Year | Until freshman | Through college |
|---|
This models a low-fee 529 in a target-date fund. You pick the year they start college. The fund starts in stocks and automatically gets more conservative as that year arrives. You do not pick funds or rebalance.
A common place to open that account is my529.org -- Utah's plan. Anyone in the United States can use it. You do not have to live in Utah. Fees on the target-date funds are about 0.11% a year. Utah's state tax credit is only for Utah taxpayers. If your state gives a tax break only for its own 529, check that first.
Flat and rising cost the same. Rising starts lower and climbs 3% a year. Flat starts higher and never moves. Both fund the same bills, and once you count what the earlier dollars earn, they come out even -- flat just gets money in sooner, so the market covers more of it and you write smaller checks. The tiebreaker is not the 529. If that money would otherwise pay down a mortgage or a credit card, rising is better. If it would sit in checking, flat is better. If you would rather set one ACH and never think about it again, flat.
College costs rise 4% a year. Monthly deposits rise 3% a year unless you pick flat. The 529 is modeled like a target-date fund: about 95% stocks when college is 17 years away, gliding down to about 20% stocks by freshman year, then staying conservative while they are enrolled. That is why a toddler's early dollars earn more than an 11th-grader's. Planning rates, not a promise. The projection follows the through-college monthly. Get a gift or inheritance? Put the new balance in and the monthly numbers move.