Debunking Common Myths About 529 College Savings Plans
Debunking Common Myths About 529 College Savings Plans
Do you feel like it's too late to open a 529 plan for your child? Think again! Check out the myths and realities of 529 college savings.
1. Myth: It's too late to open a 529 plan after your child reaches a certain age
Reality: It's never "too late" to save for college in a 529 plan. Even if your child is already a senior in high school, you can still put money into a 529 account.
2. Myth: You get a federal tax deduction for 529 plans
Reality: Sorry, there is no federal tax break for putting money into 529 plans.
3. Myth: 529 plans can only be used for four-year colleges and universities
Reality: The money saved in a 529 account can be used to pay for a wide range of higher education programs.
4. Myth: 529 plan money is "use it or lose it"
Reality: There are options for unused 529 funds, including switching the beneficiary or rolling over into a Roth IRA.
5. Myth: Only parents can put money into a 529 plan
Reality: Anyone can open a 529 plan for any beneficiary, offering a flexible way to save for college.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.