We live in Columbus, Ohio. We just welco

Answer

Congratulations on the new baby. With Columbus, Ohio as the residence and an 18-year horizon, here is what I can confirm from the Ohio issuer page and IS Q&A read this turn, plus the coarse shape from Investor.gov's asset-allocation primer. I am not ranking 529 vs taxable — that's a tax/family-shapes call that needs your inputs — but I can lay the rules and the flip-points side by side.

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### 1. Structural trade-offs — the two shells, side by side

Both shells use the same kind of investments (funds / ETFs). The difference is the tax wrapper and the rules around it.

| Slot | Ohio 529 (CollegeAdvantage) | US taxable brokerage |
|---|---|---|
| Who can open | Any US citizen/resident alien 18+ with SSN/TIN; doesn't have to be related to beneficiary. Source: CollegeAdvantage FAQ · https://www.collegeadvantage.com/general-faqs · read 2026-09-19 | Any adult; depends on the brokerage's KYC |
| Contribution deductibility (federal) | Not deductible. Source: IS 529 Q&A · https://www.irs.gov/newsroom/529-plans-questions-and-answers · read 2026-09-19 | Not deductible |
| Contribution deductibility (Ohio) | Up to **$4,000 per beneficiary per year** from Ohio taxable income, **with unlimited carryforward** of amounts above the cap. Source: CollegeAdvantage FAQ (same page) · read 2026-09-19 | None |
| Tax on growth | Federal tax-free if used for qualified expenses. Source: IS 529 Q&A · read 2026-09-19 | Capital gains and dividends taxed each year (or at sale) |
| Tax on withdrawals (qualified higher ed) | Federal- and Ohio-tax-free. Source: IS 529 Q&A; CollegeAdvantage FAQ · read 2026-09-19 | N/A |
| Tax on withdrawals (non-qualified) | Earnings portion: federal income tax + 10% federal penalty; Ohio tax treatment per state rules. Source: IS 529 Q&A · read 2026-09-19 | Capital gains tax only on gains |
| Eligible uses | Qualified higher-ed expenses; up to $10,000/yr K–12 tuition (federal); SECUE 2.0: roll over up to **$35,000 lifetime** to beneficiary's oth IA (15-year account age rule applies). Source: IS 529 Q&A · read 2026-09-19 | Anything — no restriction on use |
| Account owner vs beneficiary | Owner controls; beneficiary can be changed to another family member | You, as account holder |
| Contribution ceiling | Plan-level "Account Contribution Limit" — see Plan Offering Statement on the CollegeAdvantage site. Source: CollegeAdvantage FAQ · read 2026-09-19 | None |
| Minimum to open | $25 (most options); $500 for the Fifth Third CD option. Source: CollegeAdvantage FAQ · read 2026-09-19 | Varies by brokerage |

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### 2. Coarse asset-allocation shape for an 18-year horizon

For money you won't touch for 5+ years, the Investor.gov primer gives these two bands (Cash / Bond-like / Equity):

| | 稳一点 | 进一点 |
|---|---|---|
| 5 年+（含 18 年） | 现金 10–25 / 债类 25–45 / 股 35–60 | 现金 5–15 / 债类 15–35 / 股 50–80 |

You pick the row that matches how much short-term loss you can stomach without pausing contributions. The bands are not points — pick a number in each cell. **Buying rhythm and "should I lump-sum or DCA" are your call**, not mine; pick whichever matches your broker's minimum per purchase and any per-trade fees you can see on the product page.

A note on the product side that is not a recommendation: inside either shell, a **broad US total-market or S&P 500 index fund/ETF** plus a **broad international (ex-US) developed-markets index fund/ETF**, plus a **US total bond-market index fund/ETF** (in the bond sleeve) is the standard zero-tilt shape. Verify on the product page that the index tracked is "total market" or "broad large-cap" rather than a sector or thematic index, and check the expense ratio against a comparable peer on the issuer page before you deposit.

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### 3. What flips the choice between 529 and taxable (or how to use both)

I'm not telling you which to pick. Here are the inputs that change the answer:

- **State tax savings vs. its cost.** At $300/month ($3,600/yr) you sit just under the $4,000 Ohio deduction cap, so the full amount can be deducted from Ohio taxable income each year. The Ohio tax rate at your income determines the dollar value of that deduction. If you stop contributing to the 529 for a year, you can carry forward the unused deduction (CollegeAdvantage FAQ, read 2026-09-19).
- **Where the beneficiary actually goes.** 529 funds used at an eligible US/international college for tuition, fees, room & board (for at-least-half-time students), books, and required supplies are federal- and Ohio-tax-free. If your child gets a full ride or a scholarship, unused 529 funds can be reassigned to another family member, used up to $10,000/yr for K–12 tuition, or (under SECUE 2.0) rolled into the beneficiary's oth IA up to $35,000 lifetime (15-year account-age rule applies). Source: IS 529 Q&A · read 2026-09-19.
- **The "what if it's not enough for college" question.** If the balance falls short, a taxable account can be used for anything (housing, a wedding, a first home down payment). A 529 used for non-qualified expenses pays ordinary income tax + 10% penalty on the earnings portion.
- **Your own retirement savings.** If your own IA/401(k) isn't funded yet, some households direct the first dollars there first because retirement has no time-machine (you can't fund a 5-year-old's 18-year-old self). That's a value call, not a financial one.
- **A common, not-prescribed pattern:** fill the $4,000 Ohio deduction in the 529 first (so the state deduction isn't wasted), then overflow the rest of the $300/month (or whatever's left) into a taxable brokerage — gives you both the deduction and the unrestricted pot. This is a pattern, not my recommendation; you choose whether it fits.

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### 4. What to verify with Ohio's official pages before you deposit

ead these yourself; the numbers/rules can be updated, and the IS language on the oth rollover is still settling.

| Item | Where to look | Why |
|---|---|---|
| Ohio deduction amount, per-beneficiary, per-year | Ohio Department of Taxation FAQ · https://tax.ohio.gov/help-center/faqs/income-529-plan-account-deduction/income-529-plan-account-deduction · (page failed to load this turn; **not verified today** — re-open before filing) | Confirms current-year cap, carryforward wording, and which line of the Ohio IT 1040 it lands on |
| Plan features, fees, investment options, contribution ceiling | CollegeAdvantage "Plan Offering Statement" PDF on https://www.collegeadvantage.com · read 2026-09-19 | Confirm the version of the prospectus and the underlying fund expense ratios |
| Federal treatment of 529 → oth rollover | IS 529 Q&A · https://www.irs.gov/newsroom/529-plans-questions-and-answers · read 2026-09-19; cross-check with Notice 2024-18 on irs.gov | Confirm 15-year account-age rule, contribution limits, and earned-income requirement on the oth side |
| Federal qualified-expense definitions | Same IS Q&A page · read 2026-09-19 | Confirm room & board, K–12 cap, and apprenticeship / student-loan-repayment rules are current |

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### Honest limits

- I did not verify today's **exact closing contribution limit** or the **current Account Contribution Limit** on the CollegeAdvantage Plan Offering Statement — open the latest PDF on their site before you fund.
- The Ohio Department of Taxation FAQ page failed to load in this session, so I'm citing CollegeAdvantage's own summary of the state rule; re-open the tax.ohio.gov FAQ before you file to confirm.
- The 529-to-oth IA rollover mechanics depend on IS guidance that has been updated since SECUE 2.0; verify the current conditions (15-year rule, annual rollover cap, beneficiary earned income) on the IS page before relying on it as a backstop.
- I did not run any market-data lookup; the shape above is a category allocation, not a buy list.

If you tell me your combined Ohio-taxable income bracket and whether either of you has employer retirement-matching room, I can show you the dollar value of the $4,000 deduction and where the overflow would land — but the call between shells and the choice of funds stays yours.