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Chad CFP ®
Category: Finance
Satisfied Customers: 633
Experience:  Managing Director
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I want to invest money for my 3 year old nephew. I've been

Customer Question

I want to invest money for my 3 year old nephew. I've been using WealthFront to invest money and have good results, but the only option they have for kids is to do the 529 plan.I have 2 concerns about that:1. What if he doesn't go to college?
2. This is the bigger concern - I don't trust my sister, unfortunately, and am worried she could take the money at one point. If I use WealthFront she'll have access to the funds.So... if there is no loophole with which I can use WealthFront, can you help me figure out the best way to invest for my nephew, with the highest returns, that is still safe from my sister and will be held until he's older?I looked at bonds but they have a pretty small ROI. But maybe that's what I have to do... or hold the money under my name, then put all gains into a savings account each year maybe?Thank you!
Submitted: 1 month ago.
Category: Finance
Expert:  Chad CFP ® replied 1 month ago.

Hello my name is ***** ***** I will be able to assist you today.

1. If the named beneficiary does not use the funds for higher education you may

A) Change the beneficiary to another beneficiary who will use the funds for higher education

B) Incur a 10% Penalty for withdrawals not spent on higher education

2. 529 Plans have an account owner, which I assume would be you and a beneficiary. I reviewed Wealthfront 529 plan and did not see why or where it is required to have a second account holder.

If you are in the state of Pennslvanyia you could use that states plan and you may receive a state deduction

Please let me know if you have any follow up questions

Thank you!

Expert:  Chad CFP ® replied 1 month ago.


I have answered your question based on the information communicated to me. I ask that you take the time and scroll to the top of the page and select 3 or more stars to positively rate my response so that I can receive credit for assisting you.

Thank you!