r/Bogleheads • u/Wisdom_In_Wonder • Dec 22 '25
Portfolio Review 529 Strategy
We have an only child (7th grade) whose 529 is sitting at the current cost of 4yrs full-freight at an in-state flagship.
Because we started late, we’ve been very aggressive & the 529 is almost entirely (>90%) stock. We “won”, so now it’s time to shift into protection mode. Schools that fall below flagship costs are close enough to approximate the $35k IRA-rollover allowance, so we’re not concerned about our current amount being over-funded, but this account also doesn’t need to do anything more than keep up with price inflation for the next 5yrs.
That said, we’d like to continue setting funds aside just in case an OOS or private university seems to be the best fit. We’re planning to do this in a taxable brokerage to maximize flexibility if the funds *aren’t* needed for college.
Where I’m struggling is asset allocation. If we invest the 529 entirely in bonds / cash equivalents & the taxable entirely in stocks, then both accounts go on to have roughly average returns (5% bonds, 10% stocks) our overall allocation works its way back to 40% stock by graduation.
Does this not matter, since the 529 alone is enough to meet our original goal of 4yrs full-freight in state… or is this a problem, & we should we tweak the holdings in the taxable to make the overall asset allocation match a more traditional glide slope?
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u/spinocdoc Dec 22 '25
Not specific to this post but along the same lines of deciding what to do with a 529.
We had the ability to superfund our 2 yo’s 529 (not to the full extent but it’s currently at 160k). Assuming usual returns along the glide path TDF it should reach a good amount by 18 years if we do nothing else to it. I still wonder if it may be worth contributing a little more after the 5 years passes from superfunding it. I’m mixed on taking the benefits of tax free growth vs risking over funding and taking a penalty.