Mark A: Yes, I suppose my knowledge of VUL's are fairly limited. But,I still would not touch them. I just can't believe that a "combo" product of life insurance/mutual fund investment with the higher fees would do better than a simple term life plan and a simple 529. I'll concede "horrible" may be too strong a term, but I can't see any scenario where I would get the product. I would only keep it if I were no longer insurable.
Bwilk: Perhaps you are paying too close to the last 2 years and I to the previous 10. But, a diversified portfolio of stock mutual funds(growth, Income, Intl) has averaged about 12% annual return for the past 70 years. While its far from guaranteed, I think its a reasonable 15 year assumption. I won't argue the 100% equity allocation, that is clearly a personal choice and I know many would disagree. Its a risk I'll take and if still perusing the boards, I'll report my results in 2006 when my daughter is a Junior in college. As i said previously, the trust idea has merit. If Pjs85 or her ex feels one or the other might "abscond" with the money then by all means the protection of a trust is worthwhile. If not, then I'll "trust" its not neccesary. Finally with regard to a single mom on 40K income needing aid: Well, sure that is a very valid point. they might, but on the other hand, if that 10K investment DOES gain 12% annually and grows to 80K and the child goes to a state school she WONT need aid. I think that should be the goal. If it comes up short, well then aid is (rightfully) available. But, I don't understand the logic some have ( not you neccessarily) of purposefully NOT saving for college just to have access to public aid. By that logic, I should resign my job so the government can provide me unemployment benefits.