British Expatriate Network

So....

We want to save for our sprogs' college education. It needs to be pretty safe and it needs to be "portable" i.e. we can use it no matter where they end up going to college.

Any recommendations? What did you do/are you doing? What were/are the returns like? Do yo use a scheme specifically aimed at educational needs or are there better ways?

We are currently in Michigan, USA.

Our house is our college fund/retirement.
We are going to worry about what we can/ can't afford when the time comes. We are covered for Tom, he graduates 2007. Dan has another 41/2 years to go so we have a little time to panic.
I've heard of some tax free incentive college funds , but never looked into them. One was with Citibank

Well we've been putting everything spare into the house as we hadn't found better savings interest rates, but it seems to the general opinion that we could do better in specific educational savings schemes. However, the only ones we can find that might be better are tied to Michigan.

I ask now because our car payments will end in March and we always said they'd become college payments.

Our kids have National Savings Bonds in the UK. Should we put more money into them?

National Saving Bond have worked really well for our older kids. I think Toms has now doubled in 10 years.
My SD says his best bet is ERNIE Bonds mrgreen He gets a regular check from them

Have you considered a Coverdell ESA (aka Education IRA)?

As I understand it it's pretty portable and depending on the investments it's tied to, it could yield a significant return. I think you can tie it to a mutual fund of your choice.

I'm afraid I only have theoretical knowledge on this.

Here's a link http//www.buyandhold.com/bh/en/retirement/qa/education_ira.html

Thanks. Not sure if education outside US would be "qualified" though ??? But worth investigation.

For our kids we bought Canada Savings Bonds each year in November.

Both were told that they could use the proceeds when they left High School.

My son used it for his first year at Carleton University here in Ottawa. He was able to get some good summer employment and was able to live at home. He went on to a very successful financial career. He is now working at the IMF in Washington.

My daughter used the proceeds to go to the UK for a year. As she was born there she was able to get a job, but returned before the year was up. Did fairly well in administration in the Ottawa High Tech industry, but never really was the type to hit the books. Now lives with her husband and three cats in Montreal.

I think if you are wanting the tax perks then you need to do the instate savings. Then your money is put away tax free. It doesn't mean that you can't use it for out-of-state colleges, it just means that if you do you have to pay the tax back.

As I understand it, other than that the only other option is normal savings plans.

The only advice I have is don't put anything in the children's names. It can very easily create problems. Whereas if you keep everything in yours and Beest's names you leave our options open.

I can't find anything definative. But I think you're right...

An eligible educational institution includes post-secondary institutions offering credit towards a bachelor's degree, an associate's degree, a graduate level or professional degree or other recognized post-secondary credentials. This includes colleges, universities, and vocational schools. The institution must be eligible to participate in the Department of Education Student Aid Programs.

I always looked upon the money belonging to them so I used their names. It can also have some implications regarding the payment of tax on the interest.

TIn Canada RESP's are the most common form of saving for childrens education. I'm sure that something similar must exist in the US.
http//www.sdc.gc.ca/en/hip/lld/cesg/publicsection/faqs_resp.shtml

As I understand it, these are good schemes simply because you save on the tax. If you then go out of state and have to pay the tax, they don't look so good :???: