September 5, 2017

10 Things Everyone Should Know About 529 College Savings Plans

  1. Pays For More Than Just Tuition | Withdrawals can be used for any qualified higher education expense, including tuition, mandatory fees, supplies, books, computers or other required equipment, and even room and board.
  2. Ability To Change Beneficiaries | The beneficiary can be changed to a member of the immediate or extended family (including siblings, grandchildren, nieces, nephews, cousins and more).
  3. Control Of Assets | The account owner–not the beneficiary–maintains control of the assets, including how and when they will be used.
  4. Low Start-Up Costs | Many 529 plans allow account owners to contribute as little as $50 to open an account.
  5. Wide Range Of Schools | Accredited schools include any postsecondary college, university or vocational school that is eligible to participate in student aid programs administered by the U.S. Department of Education.
  6. No Income Restrictions | Anyone can open a plan regardless of income.
  7. Multiple Investment Options | Most 529 plans offer a wide range of investment choices allowing you to invest your assets in the portfolio that best suits your college investing goals.
  8. Convenience | You can create a monthly automatic investment plan, with portfolios that automatically rebalance as the beneficiary gets closer to college.
  9. Earnings Grow Tax Free | Earnings are free from federal income tax when withdrawn for qualified higher education expenses. Many states provide additional 529 state tax benefits to residents.
  10. Estate Planning | Five years’ worth of gifts (up to $70,000 for an individual or $140,000 if a married couple) can be made at once to a 529 plan without owing federal gift tax, as long as no other gifts are made to the same beneficiary over the five years.
Call Lake Michigan Investment Services at (616) 234-6358 or visit www.LMCU.org/Investments for a free, no-obligation appraisal of your financial situation.

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