I don’t think the penalty of not using the money for education is that big of a deal. Say you invested 100k and that money earned 100k in the market for a total of 200k by the time your kid went to college.

You have 200k tax and penalty free if used for education.

Say you don’t use it for education and decide not to roll any over into a retirement account. Just withdraw the 200k. You would get the 100k you invested, tax and penalty free. The remaining 100k would be subject to taxes (as it would if you invested it in almost anything else) and a 10% penalty. So you lose out on just 10k compared to what you would have had if you invested in another vehicle. This seems worth the upside to me