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Money for college from grandparents should be invested in a 529 college savings plan.
Unless there are compelling reasons, The real question is in who should open the 529. If there is no chance of need-based financial aid, the name on the plan is irrelevant but
If there is a chance of need-based financial aid, the parent's name, rather than the grandparent's name, should be on the 529 plan. This is so since financial aid formulas assess aid from parents lightly whereas distributions from a 529 in the grandparent's name are considered student income and, for that reason, are heavily assessed. |
