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Education Funding

It is not uncommon for our clients to ask about a prudent way to plan for education expenses. Many of our clients would like to contribute to a child or grandchild’s future education in the most effective way possible. One of the common ways to contribute to education expenses is the 529 plan. The 529 plan can offer certain tax advantages to parents and relatives to save for their child’s college education. 529s are sponsored by states and some educational institutions. The benefits of these plans include control of the asset by an adult, tax deferred growth and, if used for post-secondary education, the funds withdrawn are tax free. Another advantage to the 529 plan is that it can be used to fund the education of trade work in addition to 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 benefits 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.