Harry and Ruth Barlow (married, both age 40), just informed you during your annual review with them that they are pregnant. They werent planning any more children (they have three ages 16, 15, and 13). Now they feel a need to start funding the college education of the new child. They have been saving $3,000 annually per child since each child was born and are thinking of doing the same with the new child. All of the older children are doing well in public schools and are planning to attend college. The kids are bright and Harry and Ruth expect them to get some scholarship money, so the Barlows are concerned that they have already put too much money in tax-advantaged education accounts. Given this information, how would you recommend they save the $3,000 annually for the new child?

a) Put all of it annually into a Coverdell ESA so they have maximum flexibility regarding private school.

b) Put all of it into a Roth IRA so that it can be used for either the new childs education or their own retirement.

c) Put $2,000/year into a Coverdell ESA in case the child goes to private school and put the rest into a 529 Savings Plan.

d) Put it all into a Uniform Gift to Minors Act (UGMA) account with the intent of converting it to a 529 Savings Plan when the clients know the child will go to college.

e) Put all of it annually into a new 529 Savings Plan with the new child as the beneficiary.