529 To The Rescue

Like every parent, you too expect the best for your child- the best clothes, best house, best school and the best   college . Expecting the best for your child does not mean that you will always be able to give him/her the best. There may be financial constraints that you can face. The big problem arises when you pay for your child’s higher education. 529 is an effective tool that will be useful for you in paying the education cost of  college .

This is a known truth that the  college  costs go up each year. In order to provide your child with a good higher education you should start  saving  money now. 529 is an investment  plan  that helps you save money in a smarter way. 529  plan  is the program, which takes away all your worries related to your ward’s future education. It is a  plan  that can really help you save money for the  college  fees. 529  plans  offer two  options , one is the  college   savings   plan  and the other is prepaid tuition plan.

Some of the advantages of 529  plan  are:

* The money that you earn is income-tax free.

* You have complete control over the account proceedings. In other words, the parent who is investing money in the account has control over the assets within the program. The age of the beneficiary doesn’t matter; the control still remains in your hands and not your childs.

* You can change the beneficiary of the  plan  at any time.

* The money that you withdraw can be used for expenses such as  college  fees, books, boarding charges, lodging charges, computers etc.

* Your familys income level is not a constraint for  saving  in the 529  plans .

If you want to ensure quality education for your child in the future years, then you must start  saving  now. For example, suppose your child is 8 years old, then you have almost 10 years to save for his/her  college  education. A 529  plan  will help you do so smoothly and with a lot of ease. Ten years of  saving  might seem a long time, but if you look at the increasing costs of  college  education, you will realize how crucial  saving  in these years will be. So, if you don’t start  saving  now then realize that you are putting your child’s future at stake.

Source by Jay White

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