Bank accounts - (1 Viewer)

[cubd8]

I want to open a bank account for the sole purpose of helping my brothers/sisters kids when they are older (pay for college (for a month) as an example).

Ideally I'd like to just open an account, send $25.00 a week for the next 20 years to these accounts.

Can these accounts be locked from withdraws? Have any sort of decent interest implied, etc?

Looking for ideas. My brother is in a disaster of a relationship (not even marriage) with 2 kids and I really want to think long-term for these kids. I don't think he is saving (or can) and I want to look out for them.

Any ideas that can ensure the money gets to the kids (not my brother/girlfriend paying bills) and any kind of interest that would help.

 

[Galileo]

If thinking long term and college, what about a 529 plan? Money can only be used for college expenses, and you may get a state tax benefit as well (depending on your state)

 

[Doctor Detroit]

Would the money be for college?

You can start the kids a 529 plan and still have control over the account.

 

[Mr. Ected]

How old are the kids?

For now, why not just set up two accounts with just your name on them. You can either add the kid later or just move to a new joint account if you need to.

 

[cubd8]

Would the money be for college?

You can start the kids a 529 plan and still have control over the account.

College would be preferred (but that's just my opinion, I can't necessarily set the course for them).

Explain a 529 plan (if you don't mind).

 

[cubd8]

How old are the kids?

For now, why not just set up two accounts with just your name on them. You can either add the kid later or just move to a new joint account if you need to.

That is actually my plan (for now), but want to take a long-term approach to this. They are 4 and just over 1 year old. My sister has a little guy who is about 7 months old. I don't worry about him at all, but wouldn't mind coming up with a plan for him as well.

I'd like to help them out if their parents are unable (or too short-sighted) too.

 

[General Malaise]

529s

 

[Doctor Detroit]

And this

 

[Galileo]

and this

 

[Mr. Ected]

Info

1) wiki on 529

https://en.m.wikipedia.org/wiki/529_plan

2) for niece/nephew

http://www.savingforcollege.com/articles/529s-for-aunts-and-uncles

 

[NorvilleBarnes]

Anyone mention a 529?

 

[eoMMan]

Tell the bank teller to label the account as "HOOKERS AND BLOW AT 21...DO NOT TOUCH ".

They will know what to do.

 

[IvanKaramazov]

There's a plan out there that lets you save money for college in a tax-advantaged manner, but I just can't remember what it's called. Maybe it will come to me.

 

[BowieMercs]

529, 530... whatever it takes

 

[matuski]

just put the money into the kids existing 529 accounts....

 

[wilked]

I contribute monthly to my niece / nephews 529. 529 is your answer

 

[Leeroy Jenkins]

Doesn't the 529 prevent you from getting financial aid in some ways though? It used to not count on the fafsa but now it does or something ?

 

[The Big Guy]

You can also just start them off with a simple UTMA savings account and move to a UTMA brokerage account later and try to avoid the 529 fees. By keeping yourself the guardian, you have sole control and access to the account at all times.

 

[wilked]

Doesn't the 529 prevent you from getting financial aid in some ways though? It used to not count on the fafsa but now it does or something ?

FAFSA will expect all of the 529 to be contributed to the payment of the schooling (that is what it is there for, after all). So in that way it reduces a child's 'need' and thus their need for aid.

I find this stuff to typically be overblown, kind of like making a decent salary prevents one from getting food stamps. An Uncle's gift of a nominal amount ($1000-10000) won't greatly change that student's financial picture. Most likely it will prevent the student from taking as much in loan money

 

[Chemical X]

not sure if it's been mentioned here, but this sounds like a 529 to me.

 

[Chadstroma]

I am going to go on a limb here and mention a 529. (specifically for education)

You can set up a custodial account (UTMA) where you are the only one in control of the account but the money legally belongs to the kids. You can use that money for whatever you want to for their benefit. Education or not.

The difference is really tax related depending on the 529 and then the UTMA has no tax benefits but with interest rates they are and unless the kids have income coming in elsewhere there will be no taxation on the interest anyways for a long, long time if you are $100 a month for them.

 

[Random]

Buy them a Mustang

 

[JoeSteeler]

check out upromise.com

 

[17seconds]

A 529 might work. Let's see what the FFA says.