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College fund

By Terry Savage on May 10, 2022 | College Savings / Student Loans

I am going to redo my trust. Currently I live in Senior Housing and I was thinking when I die I would take the amount refunded from the sale of my apartment and divide into five college funds for three step great-grandsons (ages 3 to 5) and two other children (ages 4 and 8). Are there any disadvantages of doing this for them in the future. My calculations would be that each child would receive about $90,000 to $100,000.

Terry Says

You do need to consult an attorney to make these specific bequests. But I would suggest that each family immediately open a 529 account, so you can specify name and account number for each in your bequest. The parent or parents would be “custodians” of these 529 accounts. If you’re in Illinois, have them go to www.BrightStart.com to open the accounts. They don’t have to start with a lot of money, and they will get a deduction on their state income taxes if they are Illinois residents.
Then the accounts will be ready and waiting when the time comes. And I hope it is a long time from now!

PS Even though the accounts are in the Illinois plan, the money can be used for college expenses at any school, any state.

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