529 Basics
529 plans, sponsored by states, state agencies, or educational institutions, offer a smart way to save for future education expenses. These plans, authorized by Section 529 of the Internal Revenue Code, provide tax advantages to help families invest in their loved ones’ education.
With a 529 plan, your earnings grow tax-deferred at both the federal and state levels. When it’s time to pay for qualified educational expenses, your withdrawals are tax-free.
Whether you’re saving for college or other educational costs, 529 plans offer a flexible, tax-efficient solution to help students of all ages. Parents, grandparents, relatives, and even friends can contribute to a 529 plan, making it easier to prepare for the future.
WHAT CAN A 529 BE USED FOR?
Qualified education expenses
- Tuition and expenses required to enroll and attend an accredited college, university, vocational school, or other postsecondary educational institution.
- Tuition for K-12th grade, up to $10,000 per beneficiary per year.
- Fees, books, supplies, and equipment required for certain apprenticeship programs.
More ways to use 529 savings
- Student loan repayment for the designated beneficiary or their siblings (lifetime limit of $10,000 per individual).
- Unused funds, up to a limit, can be rolled into a Roth IRA in the beneficiary’s name.
Read more about how to use 529 savings here.
Your Benefit
As an employee, you have the opportunity to open one or more 529 savings accounts through the CollegeAmerica® Program. These accounts offer access to investment shares with no front or back-end commission charges, maximizing your long-term savings potential.
This voluntary education savings benefit is available to all full-time and part-time employees. While only employees can open accounts through this program, anyone—family, friends, or others—can contribute to the account to support your beneficiary’s future education.
The financial professionals at Southeast Financial Services, Inc. will walk you through the account setup process and to help you choose the best investment options for you.
ADDITIONAL RESOURCES:
