Feb 27 2014, 9:17am CST | by Sumayah Aamir
Do the numerals 529 ring a bell? They sure ought to! 529 college savings plans get their moniker from clause number 529 of the IRC. They are programs that aid you to save up on college costs that will arise sometime in the not so far-off future.
Whether it is books, tuitions, fees or room and residence, you will get a solid helping hand from these plans par excellence. And the good thing is that they apply in almost every state of the US.
Furthermore, they can be applied in another state that is not your own. The list of beneficiaries is very long. It includes significant others, children, step-parents and step-children not to mention cousins and most of all you yourself.
The fact that now computer equipment and Internet facility will be paid for from the nest egg fund is a great source of relief for many.
The recent changes in the laws of the land have proven to make 529 college savings plans even more of a lucrative deal. For one thing, their rates are becoming more reasonable. A 20% reduction in their fees is a source of joy among those Americans who are on a shoestring budget.
You can get more bang per buck from these nifty plans provided you play your cards right. The charge of a “race to the bottom” leveled against these future funding schemes may not be entirely true. And there are two types of packages on offer: prepaid and savings plans.
They both have their pros and cons and each has a particular flavor in terms of value gained from its contents. With the economy being in shambles, there is a shift to saving for a financially well-off tomorrow.
To contribute significant amounts towards a teenager’s education is what America stands for in terms of universal and compulsory education. And as for the 529 plans , they have been there since 1996.
They are a wrinkle in the law that allows many people concerned about their loved ones to further their education. And the plans are tax-free on both a federal and state level which only adds to their attraction quotient.
blog comments powered by Disqus