Thanks to generous parents, I am fortunate enough to have $517,000 set aside to pay for college tuition for two kids over the next five years - three more years for one and the last year of school plus four years for the other. A few months ago I sold that much worth of index funds to have it absolutely safe from any market crashes depleting it. At current prices I would actually need around $548,000, but I can easily make up the balance at the time if necessary. The plan was to put perhaps $300k of this (the amount that won't be needed for at least the next two years) into CDs or a high yield savings account, but with the interest rates so low there is little point. Looking to hear what others would do in this situation. Remain completely safe and keep the whole $500k in a savings account? Put it back into VTSAX and reinvest the dividends, under the assumption that I only need to take a portion out at a time and even if the market is down in a given year, since I am only taking a small portion out that year, it will likely leave enough for it to still cover what it has to over the years once the market rebounds? Or other better ideas I haven't thought of? I don't want to take too much risk of having to dip into personal funds to cover losses of this money. But I also don't want to lose the opportunity of what could be done with that much money over five years. Welcome all thoughts.
Submitted July 25, 2020 at 07:48PM by sporklover22 https://ift.tt/2XcYSh9
