Funk & Wagnalls

Milestone Navigator

Becoming a Grandparent

A new generation brings joy and new planning opportunities for legacy and support. Optimize how you contribute to their future.

1

Education Funding (529s)

Superfund a 529 plan to tax-efficiently save for education. You can contribute 5 years' worth of annual exclusions at once.

Related Concepts:529 PlanInvesting
2

Legacy Gifting

Establish a pattern of gifting to reduce your taxable estate over time while seeing the impact of your generosity.

Related Concepts:Legacy GiftingEstate Tax
3

Medical Power of Attorney

Ensure you have authorization to make decisions if parents are unavailable, if applicable in your jurisdiction.

Related Concepts:Power Of Attorney
4

Care Planning

Consider how providing physical care (babysitting) might impact your own retirement lifestyle and freedom.

Related Concepts:Care Planning

Key Tradeoffs

Key Tradeoffs

  • Education Savings: 529s offer tax-free growth for education but have penalties for non-qualified withdrawals. UTMA/UGMA accounts offer more flexibility but transfer control to the child at the age of majority (18 or 21).

Professional Consultation

Questions for your Professional

  1. What is the most tax-efficient way to contribute to my grandchild's education?
  2. How does 'superfunding' a 529 plan work and what are the reporting requirements?
  3. Should I set up a separate trust for my grandchildren?

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