I see a lot of discussion on which retirement accounts to fund first, but cannot find any discussion on which college/education saving account to fund first.
Assuming that you get NO state deduction for contributions to a 529 plan and you have already MAXED out your retirement accounts, does anyone have any opinions on which should be funded first? For example, fund a Coverdell ESA to the max ($2k) and then a 529?
If your child (children) are young, I am thinking in this case (no state deduction for 529 and retirement accounts maxed out) that you should fund a Coverdell first because it provides more flexibility on use (if you expect to pay for private school or other educational expenses (e.g., tutors) in addition to public school).
I believe I understand the rational behind the order of which retirement accounts to fund first, but I am struggling with which college/educational savings account to fund first and am approaching analysis paralysis.
One thing I keep coming back to is that all this analysis of what will happen in the near-term (private school/tutors) may be for nothing because the gains on a Coverdell maybe so small that the tax benefit is minimal. Though, every little bit helps and I am not building savings by ignoring the small costs.