Reallocate 529 AA

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WhiteMaxima
Posts: 604
Joined: Thu May 19, 2016 5:04 pm

Reallocate 529 AA

Post by WhiteMaxima » Thu Oct 12, 2017 2:50 pm

Just reallocated 50% of my Utah 529 to 20/80 Stock/Bond AA. The bull market reward us pretty well during last 10 years. One of my 17 year old is going to university next year. Think it's the perfect time to move away form 100% to 20/80. My second kid still have 10 more years to go, I left 1/2 in 100% equity. I will sleep very well knowing that 4 year college expense is sitting there 20/80 safely.

letsgobobby
Posts: 10690
Joined: Fri Sep 18, 2009 1:10 am

Re: Reallocate 529 AA

Post by letsgobobby » Thu Oct 12, 2017 2:56 pm

WhiteMaxima wrote:
Thu Oct 12, 2017 2:50 pm
Just reallocated 50% of my Utah 529 to 20/80 Stock/Bond AA. The bull market reward us pretty well during last 10 years. One of my 17 year old is going to university next year. Think it's the perfect time to move away form 100% to 20/80. My second kid still have 10 more years to go, I left 1/2 in 100% equity. I will sleep very well knowing that 4 year college expense is sitting there 20/80 safely.
So you only have 1 529, but mentally keep it segregated 50/50? If I understand you correctly then one of the halves is 20/80 and being used beginning next year; and the other half is 100/0 and being used in ten years. This sounds reasonable.

WhiteMaxima
Posts: 604
Joined: Thu May 19, 2016 5:04 pm

Re: Reallocate 529 AA

Post by WhiteMaxima » Thu Oct 12, 2017 3:03 pm

I use to have one 529 account. I just added another one and move 50% there. I keep the new one in 20/80 to weather any market correction. 529 is hard to do 100% when you have just 18 years to invest. Hard to predict if next couple of years would have good return or even a bear market. Can't afford to lose and decide to be more conservative. Sometimes, market timing is necessary to keep risk low.
Last edited by WhiteMaxima on Thu Oct 12, 2017 3:13 pm, edited 1 time in total.

soccerrules
Posts: 180
Joined: Mon Nov 14, 2016 4:01 pm

Re: Reallocate 529 AA

Post by soccerrules » Thu Oct 12, 2017 3:09 pm

Seems OK for now. Check the younger one at least every 2 years, unless there is a big downdraft in the market.

If you have 100% of college expenses in the 529 for your 17 year old and it appears you have some for the 7-8 year old, I would just make sure you don't over-fund these accounts. If there is a chance of graduate schools for either student, then you have that as a back-up option.

I have 3 kids, 3- 529's. It makes it easier to allocate the right AA for each time frame needed. I can move funds to other children if needed based on usage.
Don't let your outflow exceed your income or your upkeep will be your downfall.

WhiteMaxima
Posts: 604
Joined: Thu May 19, 2016 5:04 pm

Re: Reallocate 529 AA

Post by WhiteMaxima » Thu Oct 12, 2017 3:18 pm

I won't pay kid's post-graduate school education. They will need to earn or borrow to go graduate school. Besides, I am doing mega aft-tax 401k to fund my Roth with no money left for 529. Glad I opened 529 when kids were born. Now I don't have to worry about that expense.

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