Everything You Need to Know About 529s
These college-savings accounts have improved, and now more states offer a deduction for contributing to one.
If you are thinking about opening a 529 college savings account, now is the time to do it. Sure, most plans now let you invest any time during the year. But the sooner your money is in an account, the sooner it starts to earn tax-free returns. Plus, recent changes to the law make 529 plans more attractive than ever.
These state-sponsored savings accounts offer people an easy way to save for college. Most states have a variety of investment options, require little money to open an account and have high -- or no -- contribution limits.
Today, 31 states plus the District of Columbia offer residents a tax deduction or credit for contributing to their state's own 529 plan. Kansas, Maine and Pennsylvania even let residents take the deduction for out-of-state 529s as well. Several states, such as Indiana, just started offering write-offs. See 529 Plan FAQs below to find out if your state allows you to deduct contributions. Check out the other stories below, too, to learn more about this tax-advantaged way to save for college.
529 Plan FAQs We've got answers to your frequently asked questions about 529 plans.
Why 529s Make Sense Because of new rules, it's better to invest the bulk of your college savings in a 529 plan.
The New Math of Paying for College Changes to the law give 529 and prepaid-tuition plans a boost and diminish the advantages of custodial accounts.
Open a 529 With Little Money One of the best things about 529 accounts is that you can get started with a minimal investment.
Find the Best 529 Plan for You Use our tool to find out about the options in your state or to compare plans.
Put Aside Too Much? Here's what to do with your 529 college fund when your child gets a free ride.