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.