529 vs gift stock slices
I would like to open an account for my great niece with a gift stock slices account. However, when I was in the Schwab site, they indicated that the tax rate is high if the dividend/interest goes over $2200. Would a 529 plan be better? She is 3 years old. My goal is for her to have college money, if needed. Or would it be just as good to just open a Schwab account for her , period.
Terry Says
You definitely want to open a 529. She is too young to understand stocks — the purpose of Stockpile. Or Schwab slices. And the money becomes hers technically at age 18! And, it will highly and negatively impact financial aid! So open the 529 account –and the money will grow tax-free, can be used for any college,any state. AND, you can easily add to it throughout the years.
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