Money Matters
TMILLER45
member
Dear Community,
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
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Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Annuity Question/Advice
I just wanted to hear your advice and opinion! I am receiving an annuity of around 85k from a family members death unfortunately. I have one child and another on the way so I would like to secure this money for them and for their future. What would you do wi the money....I would like something secure but something that could also gain interest if possible. I looked into a college plan my state has (529 plan) but I really don't like that the money can only be used for college...what if my child gets a scholarship? What would you do with the money?
Re: Annuity Question/Advice
Right now our children's college fund is in our Roth IRA because we didn't want only a 529 plan, either.
Honestly, I'd keep it all in a regular savings account and you could split it up different ways. Our long-term savings is in pretty conservative mutual funds with Charles Schwab, so I am sure in 18 years the money will grow quite a bit!! I would actually put money towards my house and then keep maybe $20k for each child's college (at least as a starting point).
A couple things about the 529 plan. First of all, you can use the money for things other than college, but you just have to pay taxes on what you take out, plus 10% of the earnings/interest. In other words, you still get 90% of the earnings on it. If they get scholarships or don't go to college, you don't lose the money. If I understand correctly, since the child is not the account holder, you can use the 529 plan money for any of your children, so if one child doesn't go to college but another does, you can use it for them.
Secondly, my parents are the account holders of my daughter's 529 plan, since grandparents don't count against her for financial aid. If you trust your parents or your spouse's parents with that money/account, that's an option.
To answer your question, I would only put some of the money toward a college fund. Other things to think about: Make sure you have a good emergency fund built up (6-12 months of expenses), that you've fully contributed to your Roth IRA or company's retirement plan for the year, and pay off extra on your mortgage and/or car loans and/or credit card debt.