Educational Savings IRA

[CactusWren]

A few years ago we started these accounts for our kids. We did it because of some tax incentive and the accounts are very small. The amounts that could be added had limits. We have 3 (one account per kid; roughly $1200, $4,100, $3600 respectively).

Yesterday I received notice from Wachovia (they purchased AG Edwards where we have/had the accounts) informing us that they are now charging a $20 service fee quarterly!

Clearly they are trying to get rid of these small accounts. There is a 10% penalty for withdrawing these funds early (as in before they go to college, which is 4 years away for the oldest one).

Does anyone know where I could transfer these accounts to avoid the service fees?

Any comments or suggestions are very welcome. thanks!

 

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[kwerner]

I'm assuming your from Arizona here, but as far as I know, every state has their own 529 (college savings) program.

This is the one I found for Arizona:

Arizona Family College Savings Program

And I believe you can roll them over from state to state, so it shouldn't be a problem if one of the kids wants to go to college out of state - just roll over their portion into the other state's 529 program.

Hope this helps or at least points you in the right direction.

 

[CactusWren]

Yes, I live in AZ. Thanks for the info.

 

[Newbie]

If your kids move to another state, you wouldn't need to transfer the 529 saving program to that start. My parents set one up for me when we lived in Florida and I now live in New York. My college just sends them the full bill and FL pays their part ($X per credit hour)

 

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[Runum]

Several years ago I was real concerned about my kids college costs. I was constantly calculating how many hours of overtime it would take to pay for college. I worried a lot about it until I spoke to Adviv about it one day. He told me something that hit me like a brick. Your kids college education is only 1 or 2 deals away. You don't have to have to total cost up front. I had a few years to get it done. That was the initial goal of JCE, to pay for my kids college education. I have one more full year to achieve the goal and I believe I am way ahead of schedule.

I went from a perception of being behind the curve and worrying to ahead of the curve and relaxed in a matter of minutes. All due to shared knowledge. Thanks Andres.

I know many parents would have several kids to get through college but what could you do to get there without only saving? Good luck to all.:cheers:

 

[Margie Jerri]

The College Savings Plans Network is a national non-profit association dedicated to making college more accessible and affordable for families...

 

[CactusWren]

Just to let you know, we went with eTrade.

No fees, no minimum balance on their Coverdell accounts.

Scottrade would also have worked, but I had issues with their online application, so just went to eTrade where I did it all by snail mail.

 

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[kwerner]

Wow, thanks for the update on the college savings info. I didn't realize that Scottrade / eTrade offered ESA's. One of the things I always complained about with my state's 529 plan is the limited amount of investments available and having to wait 12 months between switching investments. I'll have to look into rolling my kid's 529 plan into an online ESA - thanks for the info! Rep++

 

[randallg99]

I bought properties with the premise that I utilize their equity for future use ala RK style (because you know, we won't have social security to pay our heating bill.)

I was single when I bought most of them

not sure at this point which direction (sell, trade or extract equity) I would take to pay for the college education, but college has me thinking...

by the year 2024 (I got nauseous just now) 4 yr private college will cost 500k (puke here)

 

[CactusWren]

So, this thread: http://www.thefastlanetomillions.co...setting-so-i-thought-id-share.html#post114320

reminded me about my kids' educational IRA accounts. Here's the update. Six months ago I filled out all the paperwork and send it all to eTrade to transfer the accounts from what is now Wells Fargo. This has not happened!

Wells Fargo is charging my kids' accounts $20 per quarter as a fee for doing absolutely nothing. This is why I decided to move the accounts in the first place.

I went back and forth with eTrade several times, because even though they opened the accounts they never transferred the funds from Wells Fargo.

Yesterday I called again (I have called 3 to 5 times and was assured every time, that I had finally completed all steps for transfer). Yesterday I was told that I had to send all the documents again, as the accounts were open but the transfer never happened, and now the documents were "too old." I asked them to close the accounts. I am looking at starting over with ScottTrade. I'll let you know what happens...

In the mean time, Wells Fargo has made $180 (60 X 3) in six months, from accounts with absolutely no transactions that together have under 15K. Not a bad return for the bank...

 

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[CactusWren]

So, it appears that we are finally with Scottrade. Impressed with their service and they are a discount broker! Less than 2 weeks for a done deal.

Sweetly, Wells Fargo charged $115 to transfer the accounts. What thiefs! Just to show how much one pays for letting things go!

Needless to say we never started with Wells Fargo, we opened the accounts with AG Edwards, but after several mergers/acquisitions in the last couple of years this is who we were "owned" by...

 

[Bobo]

So, it appears that we are finally with Scottrade. Impressed with their service and they are a discount broker! Less than 2 weeks for a done deal.

Sweetly, Wells Fargo charged $115 to transfer the accounts. What thiefs! Just to show how much one pays for letting things go!

Needless to say we never started with Wells Fargo, we opened the accounts with AG Edwards, but after several mergers/acquisitions in the last couple of years this is who we were "owned" by...

Good for you! $240 year may as well be earning interest for you, that's going to be another $3-4K you don't have to cough up for their education and I hope you send them a letter telling them why you closed your account. Love that whole "Your money isn't worth our time" attitude. ... their business isn't worth your money.

 

[CactusWren]

Hoping no one else here gets skunked by a Wells Fargo educational savings acct.

Here is hopefully the last I hear from them:

At the end of the day, Wells Fargo charged us $75 termination fee and $115 transfer fees per account, that on top of their quarterly $20 handling fee. As mentioned none of the 3 accounts had over $5K.

Stay away!

 

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[MJ DeMarco]

Hoping no one else here gets skunked by a Wells Fargo educational savings acct.

Here is hopefully the last I hear from them:

At the end of the day, Wells Fargo charged us $75 termination fee and $115 transfer fees per account, that on top of their quarterly $20 handling fee. As mentioned none of the 3 accounts had over $5K.

Stay away!

UN FN Believable! And at the interest rates they are paying, It would take you 1,302 years to reclaim those fees. In this case, the mattress is a better bank.
issed: