Tag Archives: 529

Changing our 529 investing plan

I’ve been researching fees and tax strategies, and I’ve decided to move our 529 plan from Fidelity to our state’s direct plan (Virginia inVEST).  The fee is .02% higher for the aggressive portfolio I selected, but the up to $4,000/year with unlimited carryover deductions on state taxes more than makes up for the fee.  There are also a *lot* more investment options in the Virginia plan than there are in the Fidelity NH plan.  I’ve opened up the account and made the initial deposit, but I need to file the paperwork (on paper!) to transfer the old 529 account into the new.  I didn’t realize that you could transfer 529 plans until I started researching it – I figured we were “stuck” with the initial choice (which I admit to having selected Fidelity because all of our other accounts are there).

I like Fidelity, their 529 plan is very easy to manage and I’m keeping my other accounts there, but the tax savings of moving were too enticing.  We currently contribute $600/year of our own money plus whatever Daughter Person gets for her birthday/Christmas (is usually another $600 or so from various grandparents).  We intend to increase that significantly (into the $400-$500/mth range) once our debt is paid off so that we can completely fund her college for at least an in-state school.

I know that there are differing opinions on whether we should pay for her college or not, but we feel very strongly that we should pay for her undergraduate education at an in-state school.  If it comes down to it, we’re going to prioritize retirement over college, but hopefully, we plan better than that.