What is the best way for grandparents to save for a grandchild's education?

Question

What options are there for grandparents to defer taxes and save efficiently for a new grandchild's future education?

Answer 1

<>There are a number of educational savings plans available to parents (and grandparents) in which funds may be placed tax-free or tax-deferred (below is a link to a discussion of such funds in Michigan, for example). Your best bet would be to talk to a financial advisor or possibly a bank officer to find out what is available in your area.

http://www.msu.edu/~guntzvil/College%20Educational%20Savings%20Plans%20Research%20Paper.htm

Answer 2

There are college funding programs available in the financial markets,(bonds) and some schools (if you know where the prospective student wants to go) that allow you to prepay, at a very probable discount to what its going to cost. A financial advisor could help here with a program tailored to need. IRA's are also used, and do defer taxes, but they need conditions.

Answer 3

Buy real estate, rent it out, maintain the property and have a home they can live in while they get an education. Or, sell to finance thieir education. I wish I had invested in a second home way back when. Hell, I might yet.

I would avoid the stock market like the plague.

Answer 4

the insurance saving policies.... but it's a long term investment... u can't gain profit before 6 yrs at least... but in the end of the period u get 4 times of ur invested money almost.....
it's by saving a constant amount every month or year...
and u can escalate the amount yearly...
and in the case of grands or parents death... the policy paid by the same amounts by the bank till it's due date "as it's insurance policy" and when it's due... the invested amounts with it's intrests been paid to the benficiaries determined in the policy.....
i recomend Societe General for u...
good luck

Answer 5

My advice is don't. Not everybody is cut out for college. Maybe your new addition isn't. You can get a fine education at commnunity, public and state schools. They are all affordable.
If you want you can park couple of thousand for them earmarked for that purpose. I wouldn't put a lot of resources towards it though. You can help them out in many other ways if you want. An academic career is largely what you make of it and they're far more likely to make more of it if they have to earn it themselves.

Answer 6

Look into an E.S.A. (Educational Savings Account)
Anyone can contribute money into the account but it can only be used on education. I believe that you can put up to a certain amount into it a year.