College Savings Accounts: 529 Plans and ESAs
Find out which one is right for your family.
There are two types of tax-advantaged college savings plans designed to help parents and family finance higher education: 529 Plans and Education Savings Accounts.
Both types of accounts offer tax-deferred growth. As long as the proceeds are used to finance qualified education expenses (tuition, books, supplies, computers, and room and board), the money—including any gains and investment income—can be withdrawn tax-free. And both plans are considered to be your assets, not your child’s, which means their impact on financial aid is significantly reduced.
But there are some important differences in terms of eligibility and the amounts you can contribute.
Strategy One Wealth Management can help you estimate the cost of a college education and work with you to select the best methods to fund it. Strategies may include tax-deferred savings, gifting plans and/or use of tax credits and incentives.