Ifyou're investing for collegeyou should consider opening a 529 savings plan or a state-sponsored investment account exclusively used for investing for school. With 529 savings plans, individuals can use the money they withdraw for college and K-12 tuition and other qualified educational expenses w...
These plans get their name from the section of the IRS code that authorizes this type of college savings vehicle: IRC Section 529. Essentially, a 529 plan is a tax-advantaged investment account designed specifically for tuition and other related educational costs. A 529 plan offers a variety o...
A 529 college savings plan allows families to save money for their child's college education in a tax-free investment account. If the money is used for anything outside of the qualified education expenses, the family must pay a tax penalty of 10% on the plan's...
Overall, if saving for college is your prime goal, I would suggest the 529 plan over the custodial account. If you don’t want your child to feel like the money has to be used for college, then go with the custodial account. Termination of the Custodial Account Custodial accounts terminate...
There are other ways to maximize a 529 account's growth potential, he pointed out, including making everyday spending work for you. "Consider a rewards credit card to help earn money toward college savings – one either directly connected to a 529 plan, or one earning cash back that can ...
So, let’s get to it! Let’s dive into these financial instruments and touch on the basics for the Custodial IRA, the UTMA/UGMA, and the 529 College Savings plan. What is a Custodial IRA? A custodialIRAof any type is simply money saved into anIndividualRetirementAccount fromincome earned...
Who Can Contribute To A 529 Plan? Anyone can contribute to a 529 college savings plan account and can name anyone as a beneficiary. Parents, grandparents, aunts, uncles, stepparents, spouses and friends are all allowed to contribute on behalf of a beneficiary. ...
So, should you open a 529 for each child? For most families, the pros outweigh the cons. State fee waivers and proper account management practices easily rectify the disadvantages. Need more support with 529 plans?Find a college savings professionalin your area!
Wikoff, N., Huang, J., Kim, Y., & Sherraden, M. (2013). Material hardship and 529 college savings plan participation: The mitigating effects of Child Development Accounts (Working Paper). St. Louis, MO: Washington University in St. Louis, Center for Social Development....
Should you be worried about your child’s 529 plan while the stock market declines? Are there any ways to avoid this? Are there other options available to you? Chris Miles, the Cash Flow Expert and Anti-Financial Advisor, is a leading authority teaching entrepreneurs...