Soon-to-be Grandma Thinks about Helping Grandchildren with College Costs

Hello Megan,

Helping out the new grandchild with 529 funds

Because our first grandchild is arriving in early 2024, we are thinking of ways we can financially help our kids. We want our spening on our grandchildren to reflect our values. We don't believe in little plastic toys, (well not yet anyway!) We do believe in education. We hear these same sentiments from younger clients.

We recommend College Savings (529) plans as a way to earmark the investments for college for a granchild, while keeping the ownership in the grandparent's name.

FAFSA Adjustment: A Game-Changer

In 2024, one of the most significant shifts to paying for college pertains to changes to the Free Application for Student Aid (FAFSA) application. This will change how funds from a grandparent 529 account are considered on the FAFSA application. In the past, distributions from a grandparent's 529 plan were considered income to the student, potentially affecting their eligibility when applying for need-based college financial aid. This has been a concern for many grandparents, as they didn't want to inadvertently hinder their grandchildren's access to financial aid for college. This could make significant difference as the FAFSA counts 50% of student income toward the calculation of the Expected Family Contribution currently.

Higher Contribution Limits

Starting in 2023, the annual gift exclusion limit was increacsed to $17,000 per beneficiary. This change provides grandparents with more flexibility and freedom to grow the educational savings for our grandchildren.

If you are interested in exploring 529 plans for your children, grandchildren, or great-nephews and nieces, please call us.

Sincerely,

Cass, whose grandma name is "Big Mama"

with input from Bleckley and Megan

Watercolor Financial gets all fancy for the TAP Ball!

We celebrated the Texas Advocacy Project's 40+ years of providing free legal and social solutions to end power-based abuse in Texas on October 28th. Watercolor Financial sponsored a table at the TAP Black and White Ball. Sharon Dobbs, Bleckley's wife, is a member of their board. For more information on Texas Advocacy Project, visit the TAP website.

The Mint App is shutting down, now what?

Intuit has announced it will shut down the personal finance app Mint on January 1, 2024. Intuit is asking Mint users to move to Credit Karma, one of the company's other personal-finance platforms. We know many of our clients use Mint. Here is a link to an article about seven other apps you can use to track your spending.

Access your reports: Visit our webpage for links to Fidelity (for access to statements and tax documents) and to the Orion portal (for access to performance reports and billing statements). Watercolor Financial Website

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