Meg from Missouri wrote in about 529 plans and her generous in-laws:
I recently discovered your podcast and am really enjoying it. I have a 529 question that I am having trouble finding the answer to. My husband and I have a 5-year-old, 3-year-old, and 1 year old. My in-laws have been wonderful and opened 529 plans for each of our kids on their 1st birthday. They contribute $600/year to each child. We are beyond lucky to have such a generous family. My husband has finally finished his medical training. We have purchased a home and are now able to start contributing to the 529 plans.
My question is … Can a child have more than one 529 plan? We live in Missouri. Our in-laws opened 529 plans that are not associated with our state of residence. Can we open 529 plans that would allow us to take advantage of tax benefits for the state of Missouri or can a child only have one plan?
One sign of hope coming out of the huge student loan crisis lately is that parents are starting to save more for future college expenses. According to Fidelity in 2016, families saving for college has increased from 58% to 72% over the past 10 years. With the cost of college increasing steadily, the more savings we have, the better prepared we’ll all be as parents.
The cost of college is completely out of control. Every year, the cost to attend a 4-year university increases by twice the inflation rate. To put it in some more personal terms, by the time my 5-year old little girl goes to undergrad, we’ll need around $200,000 to make a 4-year in-state university a reality. Did I mention I have two kids?!
The other major crisis affecting our country right now is the massive amount of student loan debt we all have. According to Time in 2016, more than two-thirds of college grads graduated with debt, and their average debt at graduation was about $35,000. According to that article, this number will be tripling in the next two decades.