Invested in individual brokerage account for kids
Oct 26, 2021
9 Comments
Im saving for my kids education..i didnt know of 529 plan but used my individual brokerage and kept on adding to it and investing in FSKAX & FZROX & S&P500 index fund...i was able to make 30k invested innthese 3 funds...but now i learnt 529 is better....is there a way i can withdraw and put in 529 plan after a year to lessen tax hit???
Also i am not sure where my kids study US or India..can i use these funds in 529 to pay for education expenses in india or out of us??
Inread the unstitutiin should be federal finnacial aid....whats that and please elaborate more on this...
comments
You will need to sell their current shares, which you will owe cap gains on beyond 2200 (kiddie tax)
Another option is to have their UTMA reimburse you for eligible expenses you incur, like summer camps and extracurriculars. Then, you can start afresh and fund a 529 for them but still in your control indefinitely. I believe this also requires liquidating the assets and recognizing gains, as I think technically they can't reimburse costs to you with appreciated assets without it counting as an effective sale