psaulm119
Hello, everyone. I am considering setting up a 529 or a Coverdale for our child (ETA: mid-September). I am put off by the fees and lack of choice in investment options, and am considering setting up a non-IRA account and putting the money into indexed funds.
I looked at Fidelity's site (my Roth is with their S&P 500 index), and it looks like the capital gains/dividends are in the whereabouts of 3 cents per $10 of share value. Is this outrageously small for index funds--am I reading their info right?
Reason why I'm asking, is that I am thinking that paying taxes on 3 cents for every 10 bucks of share is not going to be that much. We're probably only going to contribute $25/mo, and we'll be in the 15% income tax bracket for a while. I'm not sure what the tax (rate) I would have to pay on a non-IRA mutual fund dividend or capital gain, but I wouldn't think that it would be much.
Is there something I'm missing here? Between the loads, higher maintenance fees, and lack of ability to put the money into an index fund, I'm really thinking that I'll get a better return on my money if I forego the 529/ESA route.
Of course I'd like some feedback, esp. if you disagree.
I looked at Fidelity's site (my Roth is with their S&P 500 index), and it looks like the capital gains/dividends are in the whereabouts of 3 cents per $10 of share value. Is this outrageously small for index funds--am I reading their info right?
Reason why I'm asking, is that I am thinking that paying taxes on 3 cents for every 10 bucks of share is not going to be that much. We're probably only going to contribute $25/mo, and we'll be in the 15% income tax bracket for a while. I'm not sure what the tax (rate) I would have to pay on a non-IRA mutual fund dividend or capital gain, but I wouldn't think that it would be much.
Is there something I'm missing here? Between the loads, higher maintenance fees, and lack of ability to put the money into an index fund, I'm really thinking that I'll get a better return on my money if I forego the 529/ESA route.
Of course I'd like some feedback, esp. if you disagree.