Education expenses can be some of the largest costs an individual can incur during a lifetime. If you are planning to send your children to college or help fund your grandchildren’s education, it will take careful planning to save the money you need. The right choices will likely depend on a combination of two or more available savings methods, as well as the length of time before you need to pay tuition.
With every program, there are advantages and disadvantages. At K.Fino Financial, we will explain each program thoroughly and help you determine how much you will need to save based on your priorities and your situation. We can walk you through each of the college savings plan options available to you and also discuss alternate investing options that may work for you.
We offer access to a variety of plans that may help you tax-efficiently save for education expenses, including but not limited to:
Section 529 plans are established and maintained by state governments or agencies or eligible educational institutions. Contributions must be kept in a qualified trust in order to be treated as a qualified tuition program.
State-sponsored Prepaid Plans
Many states now offer state-sponsored plans that allow you to lock in the current cost of tuition for use in the future either by purchasing “units” of tuition or entering into contract with a specified state. The money is released when the child is ready for college.
Prior to investing in a 529 Plan investors should consider whether the investor’s or designated beneficiary’s home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state’s qualified tuition program.
Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. Please consult with your tax advisor before investing. All investing involves risk including loss of principal.