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Planning for College?

Give the gift that doesn't need batteries and won't be tossed aside with all of the other toys! A college education is a gift that will literally last a lifetime. Great gift idea for Grandparents, Aunts, Uncles and other special friends. We can provide you with gift certificates too. Call us today at 919-719-7200 or 1-800-50-PLACE to get started!  

Familiarize yourself with all of the college planning tools offered at Place Trade

Coverdell ESA

Formerly known as an Education IRA, this account enables you to set aside funding for the education of a beneficiary below the age of 18.Upon satisfaction of certain requirements, contributions and withdrawals from Coverdell ESAs are exempt from federal taxes.Our advisors can help you make the most out of your Coverdell ESA. For more information, click here.

 

529 Plans

529 College savings plans are tax-advantaged programs that make saving for college simpler. Almost every state offers at least one 529 plan, and many of these plans are open to non-residents. With flexible contribution requirements, varied investment options, and more accommodating restrictions, 529 Plans make college planning a much less daunting task. For more detailed information on 529 Plans, visit this link.

UGMA/UTMA Accounts

Manage your child’s assets wisely while securing their future. Custodial accounts allow you and your child access to tax advantages and a limitless array of securities. Technically under the ownership of the minor whose funds have been invested in the account, UGMA and UTMA accounts are a valuable tool when it comes to building your child’s financial foundation. Learn more here.

 

 

Group College Savings Program

If your company has 250 or more employees, contact us about setting up a group college savings plan. It's a great way to save for college through payroll deductions!

  • Easy to Open & Maintain
  • No cost to your corporate plan sponsor
  • Dedicated Place Trade Financial professional to assist you with the process

 

 Make saving for college easy with 529 College Saving Plans and Place Trade Financial.  Whether you are planning for your estate, if you have a newborn or are simply looking for a special gift that will last longer than a toy, the 529 College Savings Plan offers many tax advantages for your consideration.  (529 Plans allow Aunts and Uncles as well as non-related friends to easily save for a child's education too!)

Speak with one of our 529 specialists today.  They may help you understand the benefits and differences so you may determine which account is right for you." Call us today at 1-800-50-PLACE or 1-919-719-7200.

Quick Tip: Reduce your exposure to federal estate taxes while funding the education of your loved ones with a 529 College Savings Plan

 

 

Number of Contributors

 

Maximum Annual Contribution (per Child)

 

One Time (or Accelerated) Contribution*

One Contributor

$13,000

$65,000

Married Couples - Filing Jointly

$26,000

$130,000

 

*  Specific rules apply to Accelerated Contributions.  For more information please see below or visit www.irs.gov

Enjoy tax favored investing as you save for college using a 529 savings plan. Understand the difference in tax benefits between using your own state's 529 plan versus the benefits of an out of state plan.

529 College Savings Plans 101:

529 College savings plans are tax-advantaged programs that help families save for college. Almost every state offers at least one 529 plan, and many of these plans are open to non residents.

The tax advantages, investment options, restrictions, and fees vary from state to state. You can find links to 529 plan web sites at http://www.collegesavings.org or call your Place Trade financial representative at 1-800-50-PLACE or 1-919-719-7200 for more information.

College savings plans allow for students of all ages to save for college costs, including tuition, fees, room, board and textbooks.

College savings plans are not just for children, adults considering going back to college or graduate school can open a plan. Should you end up not attending school, money can be transferred tax-free to another 529 plan for your children, your spouse, or another family member.

You may also reduce your exposure to federal estate taxes while funding the college education of your loved ones. Contributions are treated as completed gifts for tax purposes allowing you to transfer assets out of your estate.

Currently you may contribute up to $13,000 per child per year gift-tax free ($26,000 for married couples filing jointly). You may make a one-time contribution of up to $65,000 per beneficiary ($130,000 for married couples filing jointly) in the first year of a five year period, provided that no other gifts are made to the beneficiary during the same five year period, and average the gift over the next five years.

For more information visit www.irs.gov.

Not Limited to In-State Public Colleges or State Residents

Many states offer college savings plans that have no residency restrictions and may be used at most colleges and universities throughout the country, including graduate schools. However, you may want to check on the tax advantages in the state you reside, or you may miss out on these advantages should you opt for another state's 529 plan.

Qualified Education Expenses

College savings plans usually cover the following expenses at eligible colleges, universities, and other post-secondary institutions:

Tuition

Fees

Books

Supplies

Equipment  (Excluding computers)

Room & Board

Contribution Limits

Contribution limits are varied by the maximum and minimum contribution limits set by the plan. Maximum amounts of contributions vary from state to state and most states offer very flexible minimum contribution limits. If you would like to increase the amount of contribution of the plan you are interested in (determined by the state), you can open a second college savings plan. Currently, the IRS only requires that contributions for one child cannot be more than the amount necessary for the qualified higher education expenses of that child. Many plans have contribution limits in excess of $200,000.

Investment Options

Each plan will give you a number of investment options allowing you to invest in various portfolios of mutual funds. Some offer age-based portfolios of mutual funds; from high risk when the child is young with higher potential returns to a gradual shift to conservative as your child grows older.

Many states also offer non-age based investment options, allowing you to select portfolios with conservative, moderate, and aggressive asset allocations. In some cases certificates of deposit are offered whose interest rates are linked to an index that measures the average cost of college tuition.

The IRS allows you to change your investment options once every calendar year, although not all plans have made the changes to permit this. Check with the plan you are considering to confirm changes to investment options every year.

Investment Risk

As with any investment, investing in college savings plans do come with risk. They do not lock in tuition prices, nor does the state back or guarantee the investments. You could lose money in a declining market, or the plan may not grow enough to pay for college.

Fees, Charges, and Expenses

All 529 plans have various fees and expenses. Fees vary among funds and some plans have different classes similar to mutual funds. (Class A, B, or C) Refer to the offering document for complete information on different classes of funds, fees and expenses.

The most common fees, charges, and expenses include:

Enrollment fees

Annual Maintenance fees

Sales Charge (Load)

Deferred Sales Charges

Administration/Management Fees

Underlying Fund Expenses

Federal Tax Advantages

Two of the most popular reasons that clients choose to invest in 529 plans when saving for college include the tax advantages that they offer and that there are no income limitations.

Please note:  Contributions that are in excess of the gift tax exclusion may be subject to the federal gift tax. The donor must live a full five years in order to benefit on estate taxes. See the offering statement for details. Consult your tax adviser to discuss your specific situation prior to investing.

Check out Coverdell Education Savings Plans (ESA) and UTMA/UGMA Plans (Custodial Accounts) as well for different college savings plan alternatives. 

 

View IRS Publication 970 to learn complete details about Tax Benefits for Education

 

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Learn more about retirement planning by visiting some of the links below:

Roth IRA

SEP IRA

SIMPLE IRA

Traditional IRA

Qualified Plans

Rollover IRAs

Find out how Place Trade can help you get the most out of your college planning by visiting some of the links below:


Coverdell ESA

529 College Savings Plans

UGMA/UTMA Accounts

 

 

 

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