My husband and I have 1 child with plans for another shortly. Both our mothers had their college paid for by our grandparents, we had our college paid by our folks, and we're committed to continuing the tradition. We're sitting on $35k in excess cash (seriously, ALL the tax-advantaged accounts are maxed, and the EF and short-term goals are fully funded). We will probably add $25k to that in 2017, $25k in 2018, and $5k in 2019, for a total of $90k. At the end of 2019, we may semi-retire, so, while we would probably still save money, we wouldn't save it in a 529.
I could put this $90k into taxable investments and/or into a 529 plan. Our state's 529 has a tax-deductible contribution max of $20k/yr. I'm having trouble figuring out what's best; I've thought over every scenario so much that my eyes are just crazy pinwheels. Should I open a 529 for my daughter, max it for 2 years, then do the same for Baby #2 for two years? Each account would have $40k, which, @ 6% would grow into $100k in 16 years. Is that a nutty huge amount, or does it just feel that way because I'm in 2016 looking at 2032 money? We'd rather under-save in the 529(s) than over-save. Will I regret front-loading the accounts if we decide to keep working?
Should I put all the money into my daughter's name, and switch the beneficiary to Kid #2 halfway through? Or, since the intent is to under-save in the 529, just use it all for her, and pull Kid #2's college costs from our other accounts?
I feel like I need a crystal ball...