Saving for college for my son with autism

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h3h8m3
Posts: 38
Joined: Thu Mar 03, 2011 11:51 am

Saving for college for my son with autism

Post by h3h8m3 »

Hello again all,

I have a preschool aged son who has autism, and an even younger neuro-typical child. I had previously intended to start up a college fund for them both, probably using a 529. However, due to the diagnosis of autism I'm not really sure what to do. Considerations are:

1. Will my autistic son be able to attend college? It's certainly possible, but his disorder makes it less likely than otherwise.
2. Will I need to pay for college if he does go? I've heard and read that there is a lot of financial aid available to special needs students when they get to college. It may be free or cheap to send him.
3. If I fund a 529 and he doesn't need it (either because he doesn't attend college or because it's paid for for us) what happens to that money?

So, I've just been putting aside money into normal taxable accounts that I've unofficially earmarked for the kids. I've got it invested in ONEQ (Fidelity's Nasdaq ETF, ER of 0.30) right now, but I'm not sure that's the best thing.

Recommendations? I appreciate your time in reading and responding to my post.
Manbaerpig
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Location: San Jose

Post by Manbaerpig »

Your kids education depends on NASDAQ? Please diversify a bit! Didn't we learn our lesson on this one around... oh... say march of 2000?


dont know the answers to your 3 questions, though!
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ryuns
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Location: Sacramento, CA

Post by ryuns »

For the first two questions, this might be a good resource:
http://www.professorsadvice.com/
Or:
http://www.collegeautismspectrum.com/

For the third question:
This is the most complete resource you're likely to find:
http://www.bogleheads.org/wiki/529_Plans
And you may want to follow this thread:
http://www.bogleheads.org/forum/viewtop ... 1300314754

Ryan
An inconvenience is only an adventure wrongly considered; an adventure is an inconvenience rightly considered. -- GK Chesterton
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alec
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Re: Saving for college for my son with autism

Post by alec »

3. If I fund a 529 and he doesn't need it (either because he doesn't attend college or because it's paid for for us) what happens to that money?
If your older child doesn't go to college, most 529 plans allow you to transfer the beneficiary of the account to the younger child. Both of MD's plans allow this.

I have an 8 yr old with Aspergers and a more neuro-typical 5 year old. I contribute to a 529 plan for the older child b/c that's all we can afford at the moment [therapies cost $$]. If he doesn't go to college, then the money can be used to pay for the 2nd child's education.
"It is difficult to get a man to understand something, when his salary depends upon his not understanding it!" - Upton Sinclair
Topic Author
h3h8m3
Posts: 38
Joined: Thu Mar 03, 2011 11:51 am

Post by h3h8m3 »

Manbaerpig wrote:Your kids education depends on NASDAQ? Please diversify a bit! Didn't we learn our lesson on this one around... oh... say march of 2000?


dont know the answers to your 3 questions, though!
Thanks for the concern. I will look into a good whole market fund through fidelity. I bet they've got a good spartan fund for that. There's not a ton in there right now and I wanted to make sure I went with an ETF that had no trade fees and a low ER.

Thanks.
AshHead
Posts: 1
Joined: Wed Mar 16, 2011 6:21 pm

Post by AshHead »

My financial adviser took out a whole life insurance policy on his son for his college payments. He told me that at his sons age the policy was very inexpensive and he panned on making the monthly payments until his son went to college at which point he could withdraw the money from the insurance policy tax free.
Topic Author
h3h8m3
Posts: 38
Joined: Thu Mar 03, 2011 11:51 am

Post by h3h8m3 »

ryuns wrote:For the first two questions, this might be a good resource:
http://www.professorsadvice.com/
Or:
http://www.collegeautismspectrum.com/

For the third question:
This is the most complete resource you're likely to find:
http://www.bogleheads.org/wiki/529_Plans
And you may want to follow this thread:
http://www.bogleheads.org/forum/viewtop ... 1300314754

Ryan
Ryan,

Thank you for providing those resources. I have taken a look through both of those first two, and while I really appreciate the information, neither of them really seem to get into the financial/saving aspect.

I will spend some time reading more about 529's. But I would also love to hear the personal experiences of anyone else who has been in my situation.
Topic Author
h3h8m3
Posts: 38
Joined: Thu Mar 03, 2011 11:51 am

Re: Saving for college for my son with autism

Post by h3h8m3 »

alec wrote:
3. If I fund a 529 and he doesn't need it (either because he doesn't attend college or because it's paid for for us) what happens to that money?
If your older child doesn't go to college, most 529 plans allow you to transfer the beneficiary of the account to the younger child. Both of MD's plans allow this.

I have an 8 yr old with Aspergers and a more neuro-typical 5 year old. I contribute to a 529 plan for the older child b/c that's all we can afford at the moment [therapies cost $$]. If he doesn't go to college, then the money can be used to pay for the 2nd child's education.
Alec, I definitely hear you about those therapies costing money. Would sure be nice if medical insurance covered ABA, huh?

Do you have any reasoning for funding 100% to your older child's 529 instead of 50% to each of them?

On a totally different subject... do you feel that having a kid on the spectrum significantly changes your feelings about saving? For me, I feel like the uncertainty of what his life will be like makes me plan to have a much bigger nest egg at the end. It seems daunting to not only be planning for my wife and my retirement, but for whatever my son might need forever. Sorry... maybe a bit too personal for this forum. Feel free to ignore. :)
Lumpr
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Joined: Tue May 19, 2009 2:23 pm

Post by Lumpr »

By way of background, I’m in a similar situation kindergarten aged son with autism, nuero-typical 2 year old sibling. So I’ve given this more than a little thought. But I’ll say right up front, that I haven’t come up with what I’d consider to be an optimal solution.

Over the last 3-4 years, I’ve met several “financial advisors” at special needs conferences that my wife and I attend. In my opinion, nine out of ten of these folks were shamelessly promoting high cost investments on the apparent assumption that people with special needs kids are so desperate they’ll try anything. The small minority, that didn’t appear to be exploiting the situation, really didn’t have any good answers although at least they were honest.

I think your first question/point is the critical one. For me, I concluded that I don’t know (a) if my son will want to go to college; (b) if going to college will enhance the quality of his life and (c) if he’ll be able to go. Another way of saying this is I’m not convinced that my son wouldn’t be better off if we are able to put a nice chunk of change in a special needs trust for him. Long story short, I decided I couldn’t really bank on the tax benefits of the 529 plan and didn’t think it was worth risking the potential tax penalties.

At the present, we just invest more into taxable accounts in the most tax efficient manner we can. Ultimately, I’m not entirely satisfied with this approach, but it is the best I’ve come up with so far.

Btw - thanks for posting about this. Doing some more homework on this topic has been on my to-do list for awhile and this serves as a great reminder.
funnymoney
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Joined: Wed Jun 27, 2007 10:17 pm

Post by funnymoney »

As a school psychologist, I worked with many of these kids and their families at various age levels. Please know that children on the spectrum can undergo enormous changes as they mature, and many of them will suitably plan on attending post-secondary educational institutions once they reach high school. Getting good people on your side and working on some of those socialization skills throughout the school years may give you benefits you didn't dare dream of. So don't hesitate to save for both kids.

Just a word on one other issue. Many children on the milder end of the spectrum begin to realize they are "different" and regret their inabilities in the social arena. I have seen several kids end up with mild to moderate depresson on top of the autism because of their deep sadness about lack of friends and difficulties being/ working/ playing in groups. For most of them, that was fairly easily treated -- but the earlier the problem was recognized, the better.

Best wishes....

Funnym0ney
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alec
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Re: Saving for college for my son with autism

Post by alec »

h3h8m3 wrote:Do you have any reasoning for funding 100% to your older child's 529 instead of 50% to each of them?
Well, we only had enough $$ to start saving for college a year or two ago, so it's not quite up to 100% of the first kid's college. :wink: Since the money is transferable from kid to kid, IMO it doesn't really matter who the beneficiary is on the 529.
On a totally different subject... do you feel that having a kid on the spectrum significantly changes your feelings about saving? For me, I feel like the uncertainty of what his life will be like makes me plan to have a much bigger nest egg at the end. It seems daunting to not only be planning for my wife and my retirement, but for whatever my son might need forever. Sorry... maybe a bit too personal for this forum. Feel free to ignore. :)
Nah, not really.
"It is difficult to get a man to understand something, when his salary depends upon his not understanding it!" - Upton Sinclair
Topic Author
h3h8m3
Posts: 38
Joined: Thu Mar 03, 2011 11:51 am

Post by h3h8m3 »

Lumpr wrote:By way of background, I’m in a similar situation kindergarten aged son with autism, nuero-typical 2 year old sibling. So I’ve given this more than a little thought. But I’ll say right up front, that I haven’t come up with what I’d consider to be an optimal solution.

Over the last 3-4 years, I’ve met several “financial advisors” at special needs conferences that my wife and I attend. In my opinion, nine out of ten of these folks were shamelessly promoting high cost investments on the apparent assumption that people with special needs kids are so desperate they’ll try anything. The small minority, that didn’t appear to be exploiting the situation, really didn’t have any good answers although at least they were honest.

I think your first question/point is the critical one. For me, I concluded that I don’t know (a) if my son will want to go to college; (b) if going to college will enhance the quality of his life and (c) if he’ll be able to go. Another way of saying this is I’m not convinced that my son wouldn’t be better off if we are able to put a nice chunk of change in a special needs trust for him. Long story short, I decided I couldn’t really bank on the tax benefits of the 529 plan and didn’t think it was worth risking the potential tax penalties.

At the present, we just invest more into taxable accounts in the most tax efficient manner we can. Ultimately, I’m not entirely satisfied with this approach, but it is the best I’ve come up with so far.

Btw - thanks for posting about this. Doing some more homework on this topic has been on my to-do list for awhile and this serves as a great reminder.
Thanks for sharing your experience on this. I'm pretty much in the same boat that you're in here. As you said, I'm not entirely satisfied with what I'm doing, but I am confident that it's significantly better than nothing, and it's the best I can feel confident with so far.

Thanks again.
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beyou
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Post by beyou »

If you get scholarships, you can withdraw penalty free from the 529
and not use for college, in addition to rolling over to another child.

Not that everyone must go to college, but I know there are colleges that
specialize in kids with such issues, or at least have programs.
Also I agree with above post, that kids may grow to point they can
function well and go to college. I have kids diagnosed with ADHD
and Aspergers each when in elementary school, but now with one in middle school and the other in HS, they have matured so much I am highly confident both will go on to college and I'll be spending all the 529 $ !

I would find a good program and save, unless you need the money for
some type of treatment right now.
“It's tough to make predictions, especially about the future.” ― Yogi Berra
Oneanddone
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Post by Oneanddone »

AshHead wrote:My financial adviser took out a whole life insurance policy on his son for his college payments. He told me that at his sons age the policy was very inexpensive and he panned on making the monthly payments until his son went to college at which point he could withdraw the money from the insurance policy tax free.
Let me guess, AshHead, you are really a life insurance salesman. Two of the features of life insurance is that it is easy to get money out and it isn't counted for federal financial aid purposes, but if it's primary purpose is to use it to pay for college, it is just plain stupid.
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Joe S.
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Joined: Sat May 05, 2007 12:11 pm

Post by Joe S. »

AshHead wrote:My financial adviser took out a whole life insurance policy on his son for his college payments. He told me that at his sons age the policy was very inexpensive and he panned on making the monthly payments until his son went to college at which point he could withdraw the money from the insurance policy tax free.
This is a very inefficient way to save for college. These insurance plans have high commissions that suck away money. You are also getting insurance you really don't need. If your kid dies, it is a tragedy, but it is not a financial tragedy. You don't need more money if your kid dies. In fact, you need less money, since kids are a financial drain. Don't buy life insurance on your kid.

Read the links below.

http://www.smartmoney.com/spending/deal ... nce-14879/

http://money.cnn.com/magazines/moneymag ... /index.htm
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ejvyas
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Re: Saving for college for my son with autism

Post by ejvyas »

I m interested to know what you did finally. I am in similar situation but I dont have anyone else who can use the funds
2015
Posts: 2906
Joined: Mon Feb 10, 2014 1:32 pm

Re:

Post by 2015 »

funnymoney wrote:As a school psychologist, I worked with many of these kids and their families at various age levels. Please know that children on the spectrum can undergo enormous changes as they mature, and many of them will suitably plan on attending post-secondary educational institutions once they reach high school. Getting good people on your side and working on some of those socialization skills throughout the school years may give you benefits you didn't dare dream of. So don't hesitate to save for both kids.

Just a word on one other issue. Many children on the milder end of the spectrum begin to realize they are "different" and regret their inabilities in the social arena. I have seen several kids end up with mild to moderate depresson on top of the autism because of their deep sadness about lack of friends and difficulties being/ working/ playing in groups. For most of them, that was fairly easily treated -- but the earlier the problem was recognized, the better.

Best wishes....

Funnym0ney
Four the past four years, I have been informally working with a now 33 year old individual with Autism Spectrum Disorder. On the scale, he is high functioning and under the former diagnosis classification would have been classified as having Aspergers. I agree one of his greatest challenges has been socialization coupled with effective communication skills (paradoxically, he is liked and well-received in social settings but struggles with interpreting nuance inherent in social cues). I am currently providing him with interventions and skills-based training that I believe should have been provided to him probably beginning around eleven years old. OTOH, he is extremely bright, and his progress has been exponential, so I agree with the right level of early support for individuals with ASD makes all the difference in the world. The key has been to "enrich" his environment with communication/socialization coaching, increasing his intrapersonal intelligence via emotional/psychological self-management training, and providing life skills support. His progress has humbly taught me to take great care with my own foolish assessments of what he cannot do or is incapable of.

This individual completed college at a California State University school, which was much less expensive than other schools. However, his father was a professor there and arranged for him to have a special course of study, which supported his success. Although the individual was not happy while at college and views those years with disdain (despite my repeated coaching that a college degree has made him more competitive in the job market), I do believe the degree has and will continue to serve to his advantage.

I view this individual not so much as being dis-abled, as much as he needs to be provided the support to be en-abled. Perhaps it may not be to the degree a typically developing individual would be, but so what? I have learned from him that individuals with ASD come into the world with their own special gifts.
stoptothink
Posts: 15368
Joined: Fri Dec 31, 2010 8:53 am

Re: Re:

Post by stoptothink »

2015 wrote:
funnymoney wrote:As a school psychologist, I worked with many of these kids and their families at various age levels. Please know that children on the spectrum can undergo enormous changes as they mature, and many of them will suitably plan on attending post-secondary educational institutions once they reach high school. Getting good people on your side and working on some of those socialization skills throughout the school years may give you benefits you didn't dare dream of. So don't hesitate to save for both kids.

Just a word on one other issue. Many children on the milder end of the spectrum begin to realize they are "different" and regret their inabilities in the social arena. I have seen several kids end up with mild to moderate depresson on top of the autism because of their deep sadness about lack of friends and difficulties being/ working/ playing in groups. For most of them, that was fairly easily treated -- but the earlier the problem was recognized, the better.

Best wishes....

Funnym0ney
Four the past four years, I have been informally working with a now 33 year old individual with Autism Spectrum Disorder. On the scale, he is high functioning and under the former diagnosis classification would have been classified as having Aspergers. I agree one of his greatest challenges has been socialization coupled with effective communication skills (paradoxically, he is liked and well-received in social settings but struggles with interpreting nuance inherent in social cues). I am currently providing him with interventions and skills-based training that I believe should have been provided to him probably beginning around eleven years old. OTOH, he is extremely bright, and his progress has been exponential, so I agree with the right level of early support for individuals with ASD makes all the difference in the world. The key has been to "enrich" his environment with communication/socialization coaching, increasing his intrapersonal intelligence via emotional/psychological self-management training, and providing life skills support. His progress has humbly taught me to take great care with my own foolish assessments of what he cannot do or is incapable of.

This individual completed college at a California State University school, which was much less expensive than other schools. However, his father was a professor there and arranged for him to have a special course of study, which supported his success. Although the individual was not happy while at college and views those years with disdain (despite my repeated coaching that a college degree has made him more competitive in the job market), I do believe the degree has and will continue to serve to his advantage.

I view this individual not so much as being dis-abled, as much as he needs to be provided the support to be en-abled. Perhaps it may not be to the degree a typically developing individual would be, but so what? I have learned from him that individuals with ASD come into the world with their own special gifts.
I have Asperger's, in fact I spoke last night at a local university about my experiences and have done so dozens of times. My wife and I also write a family blog, focusing primarily on the challenges involved in an ASD-neurotypical relationship, and I've served as a mentor to several teens with ASD through an Easter Seals program. FWIW, I have a PhD and am the chief health and exercise scientist for a health megacorp. As far as academically and in the workforce, I truly believe that my (dis)ability provides a competitive advantage; human interaction and communication, not so much. The ASD spectrum is very wide, without knowing more about the OP's child it is really hard to provide any useful advice.
KlangFool
Posts: 31426
Joined: Sat Oct 11, 2008 12:35 pm

Re: Saving for college for my son with autism

Post by KlangFool »

h3h8m3 wrote:Hello again all,

I have a preschool aged son who has autism, and an even younger neuro-typical child. I had previously intended to start up a college fund for them both, probably using a 529. However, due to the diagnosis of autism I'm not really sure what to do. Considerations are:

1. Will my autistic son be able to attend college? It's certainly possible, but his disorder makes it less likely than otherwise.
2. Will I need to pay for college if he does go? I've heard and read that there is a lot of financial aid available to special needs students when they get to college. It may be free or cheap to send him.
3. If I fund a 529 and he doesn't need it (either because he doesn't attend college or because it's paid for for us) what happens to that money?

So, I've just been putting aside money into normal taxable accounts that I've unofficially earmarked for the kids. I've got it invested in ONEQ (Fidelity's Nasdaq ETF, ER of 0.30) right now, but I'm not sure that's the best thing.

Recommendations? I appreciate your time in reading and responding to my post.
h3h8m3,

Saving for college is the last thing that you need to worry about. What if you need to support your children for the rest of their lives?

I have an autistic nephew on disability since 18 years old.

There are many autistic children in my family ( my side and my wife side). In many cases, it tends to go the extreme.

A) Need to be on disability.

B) Too smart and ace out of college.

And, many in between.

You need to be flexible. Join autistic parent support group and find out the resources that are available to you.

KlangFool
30% VWENX | 16% VFWAX/VTIAX | 14.5% VTSAX | 19.5% VBTLX | 10% VSIAX/VTMSX/VSMAX | 10% VSIGX| 30% Wellington 50% 3-funds 20% Mini-Larry
aristotelian
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Re: Saving for college for my son with autism

Post by aristotelian »

529 is a good option as others have noted because you can withdraw with no penalty on contributions and only 10% on earnings.

I-Bonds are also a possibility. They grow tax-deferred, and they become tax-free if you cash them in to pay for college expenses. You can also use them as a savings account after one year.
2015
Posts: 2906
Joined: Mon Feb 10, 2014 1:32 pm

Re: Re:

Post by 2015 »

stoptothink wrote:
2015 wrote:
funnymoney wrote:As a school psychologist, I worked with many of these kids and their families at various age levels. Please know that children on the spectrum can undergo enormous changes as they mature, and many of them will suitably plan on attending post-secondary educational institutions once they reach high school. Getting good people on your side and working on some of those socialization skills throughout the school years may give you benefits you didn't dare dream of. So don't hesitate to save for both kids.

Just a word on one other issue. Many children on the milder end of the spectrum begin to realize they are "different" and regret their inabilities in the social arena. I have seen several kids end up with mild to moderate depresson on top of the autism because of their deep sadness about lack of friends and difficulties being/ working/ playing in groups. For most of them, that was fairly easily treated -- but the earlier the problem was recognized, the better.

Best wishes....

Funnym0ney
Four the past four years, I have been informally working with a now 33 year old individual with Autism Spectrum Disorder. On the scale, he is high functioning and under the former diagnosis classification would have been classified as having Aspergers. I agree one of his greatest challenges has been socialization coupled with effective communication skills (paradoxically, he is liked and well-received in social settings but struggles with interpreting nuance inherent in social cues). I am currently providing him with interventions and skills-based training that I believe should have been provided to him probably beginning around eleven years old. OTOH, he is extremely bright, and his progress has been exponential, so I agree with the right level of early support for individuals with ASD makes all the difference in the world. The key has been to "enrich" his environment with communication/socialization coaching, increasing his intrapersonal intelligence via emotional/psychological self-management training, and providing life skills support. His progress has humbly taught me to take great care with my own foolish assessments of what he cannot do or is incapable of.

This individual completed college at a California State University school, which was much less expensive than other schools. However, his father was a professor there and arranged for him to have a special course of study, which supported his success. Although the individual was not happy while at college and views those years with disdain (despite my repeated coaching that a college degree has made him more competitive in the job market), I do believe the degree has and will continue to serve to his advantage.

I view this individual not so much as being dis-abled, as much as he needs to be provided the support to be en-abled. Perhaps it may not be to the degree a typically developing individual would be, but so what? I have learned from him that individuals with ASD come into the world with their own special gifts.
I have Asperger's, in fact I spoke last night at a local university about my experiences and have done so dozens of times. My wife and I also write a family blog, focusing primarily on the challenges involved in an ASD-neurotypical relationship, and I've served as a mentor to several teens with ASD through an Easter Seals program. FWIW, I have a PhD and am the chief health and exercise scientist for a health megacorp. As far as academically and in the workforce, I truly believe that my (dis)ability provides a competitive advantage; human interaction and communication, not so much. The ASD spectrum is very wide, without knowing more about the OP's child it is really hard to provide any useful advice.
Quite true. The individual I mentor has extraordinary memory capabilities and attention to detail, is extremely conscientious, and is quite likable--all workforce competitive advantages.
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walker46
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Re: Saving for college for my son with autism

Post by walker46 »

I'm surprised that no one has mentioned ABLE accounts which are a special new type of 529 account that is used to save for education and other non-educational needs of the disabled without disqualifying them for disability benefits. It's pretty new and is administered on the state level and at this time is only available in nineteen states. Here is a nutshell explanation of ABLE accounts:

https://turbotax.intuit.com/tax-tools/t ... 28076.html

and here is an FAQ:

https://www.ndss.org/Global/Policy/ABLE ... ns-web.pdf

I wish we would have had this for our son with Asperger's although we accomplished pretty close to the same thing with a special needs trust.
MarvinK
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Location: DC

Re: Saving for college for my son with autism

Post by MarvinK »

529 accounts can be used for traditional 2 year and 4 year colleges. Also for many vocational and trade schools. So depending on your child's future interests and type of schooling, keep an open mind.
Try to evaluate your own state's plan for it's state tax benefits during the current year.
Other states have 529 plans which may have index funds with less expensive expense ratio fees, look for the lowest in your desired fund type.


ABLE accounts - I'm glad these were brought up!
These seem like a valuable tool for those who qualify. Many people still don't know about ABLE accounts!
I have been disappointed to see the fees are 0.31% - 0.34% (Ohio example)
When the underlying investments are Vanguard Life Strategy fund that is 0.15%. The difference is what the state is choosing for their administrative fee. I hope the states wise up and lower their fees, especially for ABLE accounts!
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