Last week I enjoyed an afternoon with my children at the Crafting Studio in New York City. While my children had fun crafting, I learned about the NY's 529 College Savings Program at the #NYs529Event hosted by Mom Trends. A great opportunity to mingle with fellow blogger families and learn about a great option to start saving for our children's future. I always imagined opening a savings account for higher education to be a difficult task, at the least one that would require a large amount to deposit, so I was pleasantly surprised that it takes as little as a dollar to open an account. The other fact that stood out to me that I wanted to share with you all is that there are tax savings, you earnings grow federally tax-deferred, qualified withdrawals are tax-free, and in some states like here in New York have other tax benefits as well.
Just about anyone can open a 529 account for children for the money to be used for educational purposes in the future, it can be parents, grandparents, other relatives, even friends, as long as a U.S citizen or a resident alien. The account owner picks investments, assign a beneficiary, and determine how the money is used. The account holder can also benefit from the state tax deduction as well.
The money saved in the 529 account can be used for anything considered a qualified higher-education expense, including tuition; books, supplies, equipments, expenses for the purchase of certain computer equipment, software, and computer related services. Some room and board fees as well. There are eligible education institutions like trade schools or vocational schools that the money can be used towards as well, not just 2-4 year colleges.
- Beneficiaries can attend college in any state, not just the state sponsoring the #529 plan.
- There are no income restrictions to open a #529 account.
- An eligible education institution is a school that has been assigned a federal school code by the Department of Education.
- The account owner - not the beneficiary - is always in control of the account, even when the beneficiary becomes an adult.
- There is no age limit for beneficiaries of a 529 on a 529 plan.
- A beneficiary can have more than one account. For example, parents can open an account for a child and grandparents can open an account for the same child.
- Advantages of a 529: tax deductions, tax-deferred growth, and tax-free withdrawals.
- Recurring contributions are a convenient way for account owners to set regular contributions.
- 529 funds can be transferred to a close relative of the beneficiary if he or she doesn't need the money.
More information about NY's 529 College Savings Program can be found ate the following sites;
NY 529 Direct site:
www.NYSaves.org
NY 529 Direct YouTube page:
www.youtube.com/NY529Direct
NY 529 Direct Facebook page:
www.facebook.com/NY529Direct
College savings planner (tool):
http://www.archimedes.com/vanguard/csp.phtml
NY 529 Direct Twitter:
www.twitter.com/NY529Direct
529 state tax deduction calculator:
http://www.archimedes.com/vanguard/stdc.phtml
Compensation was provided by NY529Direct via Momtrends. The opinions expressed here in are those of the author and are not indicative of the opinions of NY 529 Direct or Momtrends.
