Filed under: Lynnette Khalfani-Cox
A 529 Plan is a state-sponsored college savings account that lets you sock away money for a host of college costs, including tuition, fees, books, supplies, equipment, room and board. The 529 Plan offers a host of attractive benefits. Earnings on these funds are tax-free when you withdraw the money for qualified higher education costs. Additionally, the accounts are portable, so your children can use the money at virtually any college or university in the country. There are no income limits imposed. And 529 plans feature high contribution limits, often $250,000 or more.
Granted, most of us aren't going to stash away a quarter million dollars. Some people would be lucky to save $25,000 for their kids college costs. But if your kids are Ivy-League bound, that $250,000 figure isn't a stretch for the cost of a four-year education. And as I explain in my book, 'Zero Debt for College Grads,' you don't want your kids (or you) to go into heavy debt with massive student loans just to get a degree.
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So don't procrastinate in saving. You can learn more about 529 plans at: Savingforcollege.com. As always, the earlier you start saving the better.
Lynnette Khalfani-Cox, an award-winning financial news journalist and former Wall Street Journal reporter for CNBC, has been featured in the Washington Post, USA Today, and the New York Times, as well as magazines ranging from Essence and Redbook to Black Enterprise and Smart Money. Check out her New York Times best seller 'Zero Debt: The Ultimate Guide to Financial Freedom.'