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@Mrs D: We set up a 529 plan and with that you can invite others to be contributors. My ILs make contributions there and some other family members have asked for the info so they could contribute for the kids' birthday. Maybe you can suggest this to your ILs?

I would do my own accounts but not put it all in education only accounts. Probably some money market or other stocks. You're not going to overdo it in the next 5 years so let it grow to whatever they want and then have your DH ask again in that time and you can reassess the money breakdown at that point.

I find it weird that they haven't let you know specifically how much they're contributing. When DS was born my parents said they wanted to set up a trust for him for college. They debated a few options and finally decided to contribute yearly instead of a large lump sum all at once. They told me how much they're going to contribute and with which state plan.

I don't think it's out of bounds for your DH to ask how much they think they're going to contribute. But I do think your #2 is kind of weird. The pre-tax accounts can only be used for schooling expenses, so the fact that she wants to police that money seems weird to me. Say she decides your LO needs to have a 3.5 GPA. What happens if it drop to 3.0? Or 2.7? Will your LO lose access to that money? What happens to the money then, since it can only be used for education expenses? It's not like she's setting up a general trust fund to be distributed at age 18 or whatever.

If they're not going to be cooperative, you may just want to go ahead and save what you can and pretend there is no extra money coming from them.

I would ask for the account information so that you can check the balances over time. It seems crazy for people to give your children thousands of dollars but not let you know how much they are giving.

You could also consider separating out your own contributions so that you are putting a portion of it in a fund that is not specifically for education. That is what we are doing, at least. I don't think anyone can predict what higher education (or taxes) will look like in close to 20 years so I'm personally not comfortable putting all my eggs in one basket.

My MIL has a 529 for DD that she has been contributing $500 per month to. She has told us that when the new LO comes round she will set up a second 529 account and then do $300 for each child from then on out.

DH and I will have our own 529s and also use Roths to contribute for the kids. There is different weight given to a parent 529 vs a grandparent 529 when determining financial aid, so it is better for you to have your own vehicles for savings vs adding to theirs.

Additionally, if there are tax benefits available in your state, you will need to use your own acct to benefit. I would just have DH tell his dad that he needs to run some calculators to see how much of a difference to account for so he needs to have a better handle on how much they are contributing.

If you want to know the contribution level, just ask. Tell them you are doing some financial planning and would like to better understand what they have already contributed to LOs 529 plan.

I wouldn't be worried about over contribution - especially if LO is 2. A lot of factors could change your ILs contribution rate in the next 16 years (their financial situation, number of grandchildren/amount available to contribute, etc). College costs are increasing at a much higer rate than inflation. Check in again in 10 years and see what the balance is in the account and what college costs look like and then your ILs can stop contributing if it looks like there is too much money in the plan. Also, your LOs might want to go to grad school or a private university - any money above what you were anticipating could be used towards those expenses.

FYI - you can change the beneficiary on a 529 plan. So if your ILs have 10 grandchildren, and grandchild #1 gets a full scholarship, they can apply that money to grandchild #10.

@Mrs D: What kind of account is it exactly? Is it definitely a 529?

Regarding #1, I think it’s a little odd they won’t tell you, but maybe they are not 100% sure yet, and don’t want you banking on one specific amount. That makes sense to me. I personally wouldn’t worry about over contributing, especially since you’ll have multiple LO’s, and especially if you think it may be like 2k a year. Anything they contribute is awesome, don’t get me wrong, but I wouldn’t change or sway my personal savings plans over $2k a year contribution. Honestly, I wouldn’t push them now. I’d wait a few years, and check in. By then, they may have more of a standard contribution figured out, and be more open to talking.

#2, it’s your MIL’s money, so I don’t think it’s *that* weird for her to name herself a trustee of the account. I think it would be more reasonable for you or your husband to be named trustee, but at the end of the day, it’s her money. But, it doesn’t sounds like she plans on setting up a 529, or if she does, maybe she doesn’t understand fully how it works? (If she thinks it is “free money” once they go to college?). Maybe just sitting down and talking about what they are looking for – and letting them know what carious options are out there.

@Mrs D: nope. It can be changed to other beneficiaries. Plus, it can cover higher education costs such as graduate school, medical or law school.

@Mrs D: are you thinking of a state credit? Some states allow a credit if you contribute to that states 529 plan. There are no federal deductions or credits for deductions to 529 plan. Perhaps they have done tax planning strategy and set up a trust, in that circumstance it would important for them to be on so they can control the money. My parents have trusts set up for tax planning purposes. It's a very popular tax planning strategy.

@Truth Bombs: agree

@Truth Bombs: Couldn't agree with you more.

I feel like grandparents can start a 529 plan without telling the parents that they've done so. Your MIL was nice enough to tell you, but it's not necessary for her to inform you of how much she's contributing to this plan.