Using other people’s money to pay for your child’s college may seem too good to be true. But there are some ways to do this, besides scholarships. One is rewards credit cards that contribute cash back to a 529 account. If you are accruing frequent flyer miles or another reward and not using it, it may be worth looking at…
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529 Plans
The crazy number of pictures on Facebook of my friends’ kids graduating from high school means it’s time to talk about how you get money out of the 529 plan to which you’ve been diligently (or otherwise) contributing. First of all, a 529 plan isn’t like an HSA or medical savings account where you get a debit card to use…
Many parents who aren’t sure if their children will pursue 4-year degrees think that 529 plans are therefore not for them. If that sounds like you, you may be surprised to learn that funds in 529 plans can be used at a wide range of schools including community colleges, technical, trade and professional schools. Any school that is eligible for…
Last month, a bill was introduced in Congress that would make some great changes to 529 plans. One of the best is this: it would allow account holders to roll up to $25,000 in leftover 529 plan funds into a Roth IRA with no taxes or penalty. There are some conditions, such as that the account must have been open…
Given the lower contribution limit—$2000 annually per beneficiary—many people wonder why anyone would bother with a Coverdell ESA, compared with a 529 plan. Here’s a quick overview; maybe you’ll find that a Coverdell ESA should be part of your college savings planning as well. Coverdell ESAs work a lot like Roth IRAs and 529 plans: You contribute after-tax money to…