A few questions for new Plebe (car ins, 529, scholarships, ...)

Discussion in 'Naval Academy - USNA' started by USNArules, Jun 22, 2015.

  1. USNArules

    USNArules Member

    Aug 10, 2014
    Likes Received:
    Two questions for experienced Mids and Parents:

    1. I've heard Plebes are not allowed to drive, so should I take my DD off of car insurance for now?
    2. Is there any advantage/dis-advantage to putting any money from 529 plan and/or scholarships into the new Plebe's NFCU bank account? The paperwork indicates some money can be deposited.


    Thank You in advance!
  2. suddensam

    suddensam USNA BGO 5-Year Member

    Feb 7, 2012
    Likes Received:
    I did take my son off of our insurance, and added him back when he was home on breaks. It represented a decent amount of savings.

    Regarding the 529, there are a lot of considerations there. There is an exemption from the penalty tax on 529 withdrawals for academy appointees, but that doesn't necessarily mean that you have to withdrawal the money. You can still take advantage of the rules that allow you to "roll over" 529 assets to another beneficiary, e.g., a sibling. If you don't need it for another tuition, you could withdrawal it and not have to pay the 10% penalty, although I think that you will have to pay ordinary income tax on the earnings. But withdrawing it from a 529 and dropping it into an NFCU checking account might not be a great play, assuming the yield on a checking account is next to nothing. Perhaps you could leave it in the 529 and invest it in a more suitable way given assumedly different objective and time horizon.
    JShawshank likes this.

Share This Page