Join Early Retirement Today
Thread Tools Search this Thread Display Modes
Old 12-22-2015, 06:17 PM   #21
Moderator Emeritus
Bestwifeever's Avatar
Join Date: Sep 2007
Posts: 16,563
We are giving each of our kids a couple of thousand this year as a surprise--not a huge gift but a nice chunk of change imo. We did a little less for the first time last year and they were gobsmacked. One needs a new roof so it might go toward that, the other has pricey kids' school so it might go to that. Or maybe they will buy a piece of furniture or go on vacation--they can do what they want. Both have decent jobs and are saving toward retirement and have college funds set up already, but if we wanted the cash used only for that, we'd just keep it all until they needed it (or it came to them in our estate--which should be a decent size but nowhere near big enough to need tax considerations) and get them something else as a gift.

But I am sure the OP's kids will appreciate your gift, strings or not!

“Would you like an adventure now, or would you like to have your tea first?” J.M. Barrie, Peter Pan
Bestwifeever is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 12-23-2015, 08:24 AM   #22
Recycles dryer sheets
Join Date: Jul 2009
Posts: 349
Great thoughts, all ...

I am trying to do another thing, as well ... make them THINK about the various options for investing, for passing money on, for planning as a necessary part of living with money and needing money, etc.

I know it is a bit confusing - I want them to be a bit confused so they will think and consider their own options for their futures.

The 529 system looks like it is set up to allow changes of beneficiaries easily and quickly with lots of flexibility - the only real down side is if they don't have children .. then there are penalties and tax to be paid. I am thinking I have some time - and if I die, my wife then has some time to either eliminate the account and pay the taxes and penalty (neither kid has kids) or align the total amount to the kids that only one of the kids has ...yeah, playing some probabilities.

If I were to assign the kids as beneficiaries, and they didn't have kids they could spend the money on their own education (positive), but if they do have kids the amount would be included in part of their FAFSA computation.

I haven't pulled the trigger on any of this, yet .. did go part way through the Fidelity process yesterday on line - very easy ...

The key question for me may be: Do I assign myself as beneficiary or each of the kids - it would seem like more of a gift and worth the FAFSA risk to this ...

stephenson is offline   Reply With Quote
Old 12-23-2015, 01:19 PM   #23
Recycles dryer sheets
Join Date: Jul 2009
Posts: 349
Done more reading ... IRS Pub 970 is pretty clear on most of typical 529 questions .... the definition of "family" of a beneficiary is quite broad and will cover just about any family situation ...
stephenson is offline   Reply With Quote
Old 12-24-2015, 04:19 PM   #24
Recycles dryer sheets
Join Date: Jun 2015
Posts: 101
This year I wanted to give large gifts to my two adult children as well but wanted to encourage savings. So I offered to match dollar for dollar whatever contributions they make to their 2016 ROTH accounts.
Joylush is offline   Reply With Quote
Old 12-26-2015, 09:14 AM   #25
Recycles dryer sheets
Join Date: Jul 2009
Posts: 349
Hi All,

Wanted to summarize and close out what I finally did - not saying it is "the" answer, but it seems to answer most of what I was trying to do.

I was not trying to teach my kids what to do with money, but rather how to analyze and consider options for meeting a need, or giving a gift while balancing federal tax opportunities and restrictions least this is what I sounded like while I was discussing it with them.

So, I set up a 529 Unique (New Hampshire is the sponsoring state) with Fidelity with $1000 to each of the two sons. I am the "participant" (owner) and I made each of them the "beneficiary." I walked them through my "whys" and how the account would roll to my wife when I die, how I/she would manage the account, add money when available and appropriate, how their role as current beneficiaries works and how the beneficiary can be reassigned easily, how FAFSA treats the accounts based on who owns and is the beneficiaries, and finally why I chose the Fidelity Aggressive Index fund (offered as one of the few options that are characteristic of 529s).

While neither have children, they appeared to be very pleased and interested in learning more about the system and how to use it for future benefit - maybe am kidding myself, but this sounded positive to me :-)

Thank you, All, again, for the great comments - I hope my experience will be helpful to someone else, whether they choose my approach or not.

stephenson is offline   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
November I Bond rate set with a .2% fixed composite set at 1.38% Mulligan FIRE and Money 1 11-10-2013 04:02 PM
Advice for helping to set kids on path to ER EvrClrx311 FIRE and Money 19 05-24-2012 02:08 PM
Any experience with charitable gift accounts? ziggy29 FIRE and Money 20 08-31-2010 03:06 PM
Deciding WHEN to to make final move, location, timing w kids schooling etc. thefed Life after FIRE 14 11-25-2009 12:43 AM
location, location, location Martha Life after FIRE 20 04-27-2007 12:26 PM


All times are GMT -6. The time now is 10:05 AM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2018, vBulletin Solutions, Inc.