Saving for College - What is the Best Approach?

[fools_gold]

Thanks for that. You basically confirmed everything I thought.
With vanguard pulling out of Japan, I’ll need to check out if the NISA version is still available.

The Saison Vanguard fund isn't bad, but it has relatively high fees and they also keep 0.1% of any money you withdraw. It's also about 50% bonds. The great thing about the Junior NISA is that the investments compound tax free until your child is an adult. With a longer investment horizon you might be better off investing in something with more stocks.

[Kanto]

Thanks for that. You basically confirmed everything I thought.
With vanguard pulling out of Japan, I’ll need to check out if the NISA version is still available.

The Saison Vanguard fund isn't bad, but it has relatively high fees and they also keep 0.1% of any money you withdraw. It's also about 50% bonds. The great thing about the Junior NISA is that the investments compound tax free until your child is an adult. With a longer investment horizon you might be better off investing in something with more stocks.

Your comment actually touches on something I was unsure about.

I started a J-Nisa this year. I will max it out for the remaining years. (4x80万). （Currently 80万 of Emaxis All country)

Considering the money is locked away for 18-20 years, and cannot be rebalanced, what allocation should I be aiming for?.

Should I be treating this ammount as separate from my other investments?

[Bubblegun]

Index funds are designed using a benchmark and basically buy one or more funds. They are going to be basically the same regardless of which company manages them (the fees may differ though).

Brokers tend to be hands-off in that they charge low fees to more people and don't give individual advice.

You can't 'move' investments into NISA, but rather need to buy new ones inside the NISA wrapper (either with new money or by selling the current investments and buying new ones).

Generally speaking, it is better to pay no tax using NISA than pay tax in a taxable account.

Thanks for that. You basically confirmed everything I thought.
With vanguard pulling out of Japan, I’ll need to check out if the NISA version is still available.

Vanguard pulling out of Japanese (Physically) does not change things for individual retail investor like ourselves. The funds are still available on Rakuten and other brokers.

However, keep in mind that many MUGJ Emaxis slim mutual fund products have a cost advantage over Vanguard products.

Bogle himself would not want us to pay more, for something of equal quality!

Well that’s great to know. It has performed better than my UK endowment fund. So I can’t complain too much about that.
I suppose I might keep it running,(if I or the kids do need it), I might just reduce the monthly investment, and put it into something else for myself for the next 13 years.

Any ideas on choosing a fund for the next 12/14 years. More risk? More balanced?
If I had a long term fund I would want to see it more balanced towards .....how shall I say...zzzzzzzzzz my older years. LoL

Btw since we are also talking about college funds.
Have we mostly locked it away, until the kids need it, or have you chosen funds that are accessible just in case mum and dad need it for emergency funds. Eg Medical, unemployment, or even in today’s environment Covid 19 lock downs.
I’ve tried to keep everything easily accessible just in case.

[RetireJapan]

As there are no particularly compelling vehicles solely for saving for college, etc. I have come to favour just investing the money myself and then having the option to give it to my granddaughter later or not, depending on how things turn out. Between my wife and I we could give her up to 2.2 million yen a year tax free if necessary.

[Jansen]

Between my wife and I we could give her up to 2.2 million yen a year tax free if necessary.

I don't think that's how it works?

Each person can receive 1.1million yen a year tax free. Not that each person may gift another person 1.1m tax free.

[RetireJapan]

Between my wife and I we could give her up to 2.2 million yen a year tax free if necessary.

I don't think that's how it works?

Each person can receive 1.1million yen a year tax free. Not that each person may gift another person 1.1m tax free.

Eeek. You are completely right, and I am at best distracted and at worst an idiot.

I guess that would be the advantage of some of the other options (giving a younger child money to invest in a junior NISA or child investment account, or some of the educational insurance products): spreading the gifts over different tax years.

[Moneymatters]

Between my wife and I we could give her up to 2.2 million yen a year tax free if necessary.

I don't think that's how it works?

Each person can receive 1.1million yen a year tax free. Not that each person may gift another person 1.1m tax free.

Eeek. You are completely right, and I am at best distracted and at worst an idiot.

I guess that would be the advantage of some of the other options (giving a younger child money to invest in a junior NISA or child investment account, or some of the educational insurance products): spreading the gifts over different tax years.

For a grandkid and for purpose of education you can give them 1,500万.

https://fp-moneydoctor.com/news/knowled ... tion-fund/

Sorry if this was already commonly known.

[beanhead]

Btw since we are also talking about college funds.
Have we mostly locked it away, until the kids need it, or have you chosen funds that are accessible just in case mum and dad need it for emergency funds. Eg Medical, unemployment, or even in today’s environment Covid 19 lock downs.
I’ve tried to keep everything easily accessible just in case.

Ben mentions to move more from stocks to bonds as we get closer to needing the money. So treat is as similar to retirement, where you take on less risk since you need the cash for fees. I am wondering if anyone can share any tips about when they did this?
I generally do not like bonds, so don't want to move too early into the conservative bond portfolio and miss chances for further growth.

[fools_gold]

For a grandkid and for purpose of education you can give them 1,500万.

https://fp-moneydoctor.com/news/knowled ... tion-fund/

Sorry if this was already commonly known.

It's a bit further down the line, but you can also gift up to 30 million yen tax free for real estate purchases.

[robster]

For a grandkid and for purpose of education you can give them 1,500万.

https://fp-moneydoctor.com/news/knowled ... tion-fund/

Sorry if this was already commonly known.
[/quote]


This is interesting ... although it is set to expire at the end of this month.
Has anyone any experience doing this?
Wondering how difficult it would be to set up, if the gifting grandparents are not resident in Japan but overseas ...