Lucas' College Savings

Ever since we found out that Lucas was on his way (about 7 months ago), we've been investing in his education. More specifically, we've been saving in a Fidelity 529 College Investment Plan, run by the State of New Hampshire. Why New Hampshire? Because it has one of the best selection of low-cost Fidelity mutual funds. Also, 529 accounts can be used at any educational institution, not just at New Hampshire. Lucas' plan is invested in an age-based portfolio that automatically allocates its holdings based on age. Right now, since he still has 18+ years to go until college, the plan is invested in a mix of stock index funds (domestic and international). Check out savingforcollege.com for more information about 529 plans.

Why didn't we choose Vanguard, you ask? Although most of our portfolio is with Vanguard, their initial investment requirement is pretty steep for 529 plans ($3,000). Also, our Fidelity Investments 529 College Rewards MasterCard, our primary credit card, is linked to the 529 plan. It re-invests 2% of our total card purchases back into the 529 account (about $150 a quarter, not too shabby).
Finally, all our credit cards and grocery cards are linked to Lucas' account at Upromise. It's a site that saves a percentage of eligible purchases in an education account. So whenever we buy, say Florida's Natural orange juice at Albertson's or Mobil1 synthetic oil at PepBoys, 2% of the purchase price is transferred to the account.

We feel that we've got a head start on Lucas' college savings, and we'll gladly use the power of time and compounding to work to his advantage.