Young couple with child

College Savings Plans

Total student loan debt has reached roughly $1 trillion, and college costs continue to grow faster than inflation. Perhaps some level of education borrowing is inevitable in this environment, but the amount can be made more manageable if there is a pool of savings to be tapped.  

Tax-preferred College Savings Choices

One of the best legacies parents can leave the world is well-educated children. The costs of that legacy continue to rise at an ever-increasing pace. Fortunately, there are tax-advantaged plans to give families a boost as they accumulate capital for meeting education expenses. With each plan, there’s no tax deduction for setting money aside, but taxes are deferred on earnings. Withdrawals used for qualified education expenses, such as tuition and books, are completely tax free.


529 College Savings Programs 
529 Plans are offered by states and contributions can come from anyone (relatives and friends). A First National Investment Executive can:

  • Guide you through the different plan options
  • Determine the best plan for you
  • Before investing in a 529 plan, carefully consider whether you or your beneficiary's home state offers any state tax or other benefits available only from that state's 529 plan


​Coverdell Education Savings Account Plans  
Unlike 529 plans, these plans are owned by the child and can be used for qualifying education expenses including ones prior to college. Work with a First National Investment Executive to:

  • Assess your risk with select investments in these plans
  • Obtain guidance on different plans available to you
  • Recommend investments that match your savings needs


UTMA/UGMA Plans 
These plans vary from state to state and are subject to taxes each year. These accounts are in a child's name and the responsibility is on them to pay the taxes, though they are taxed at a lower rate. These are opened through a regular brokerage or mutual fund account. A First National Investment Executive can:

  • Review which is best for you and your family
  • Evaluate pros and cons of the account


Start today
Whether you're a new parent who has years to invest or a parent of a high school student whose investment time frame is very short, a sound investment strategy can help meet your needs. Don’t let doubt or uncertainty lead to indecision. Wondering which plan is right for your future scholar? Worried about making the right investment decisions? Let us help you sort through your choices, and you can implement your planning with a sense of confidence.

 

 

 


Securities and insurance products are offered through Cetera Investment Services LLC (doing insurance business in CA as CFGIS Insurance Agency), member FINRA/SIPC. Advisory services are offered through Cetera Investment Advisers LLC. Neither firm is affiliated with the financial institution where investment services are offered.
Investments are:

  • Not FDIC/NCUSIF insured
  • May lose value
  • Not financial institution guaranteed
  • Not a deposit
  • Not insured by any federal government agency

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Financial Professionals are registered to conduct securities business and licensed to conduct insurance business in limited states. Response to, or contact with residents of other states will only be made upon compliance with applicable licensing and registration requirements. The information in this website if for U.S. residents only and does not constitute an offer to sell, or a solicitation of an offer to purchase brokerage services to persons outside of the United States. Portions © 2015 M.A.Co. All rights reserved.