Finance at a glance contributed by Geezeo
5 College Savings Alternatives to 529 Plans
by MainStreet.com Staff Writers
529 college savings plans are accounts set aside by parents, grandparents or guardians to pay for the future tuition of young children. Earnings grow tax-deferred, and the minimum contributions are kept low to allow various families to be able to afford these plans (i.e. $50 a month). Further, funds are not subject to taxation when they are withdrawn, as long as they are used for approved educational purposes.
But 529 plans do have a contribution limit. So if you’re looking to give more to your child’s education (or you want to shop around before settling on a savings plan), here are some other options.
Coverdell Education Savings Account (CESA)
CESAs can be purchased through most brokerage and fund companies. This option provides broad investment choices and features tax-free earnings as long as they are used to pay for qualified education expenses, including [Read more…] about 5 College Savings Alternatives to 529 Plans