College Planning
Ease the Path to Higher Education
It's never too soon to plan for your children's future. We tailor college planning to the needs, dreams, and goals of each family, taking into account both financial realities and educational aspirations, as well as family demographics.
Let us help you define your educational goals, with flexibility to change with your child's desires as they grow. We analyze realistic educational costs and project expenses to make sure you have the right savings at the right time. All of this is done through diverse investment vehicles designed for education savings.
Educating planning is complicated and you have a number of options to help your child graduate without stress and with a minimum of debt.
529 College Savings Plan
These state-sponsored accounts allow tax-deferred growth, and withdrawals used for qualified education expenses are tax free. 529 plans are controlled by a parent. You can also choose a prepaid tuition plan, which can allow you to pay today's tuition, but this can reduce flexibility. Any money your child doesn't spend on college can be rolled over into a Roth IRA.
CUSTODIAL ACCOUNT
A custodial account is not as tax-sheltered as a 529 plan, but more flexible. This is basically a savings account you manage on your child's behalf. It's not tax free, but the money can be used for anything as long as it benefits the minor. This means you can use it for things like your child's college wardrobe, and it's a good option if you aren't sure your child will go to college. However, it can count towards their assets for financial aid.
SAVINGS ACCOUNT
You can also help your child open their own savings account. You will act as a joint account holder with your child, and they will learn to save money. However, these accounts typically don't pay as much interest as a 529 account. Where they are useful is if your child is working and they want to save some of their own money towards college expenses.
ROTH IRA
Last, but not least, you can set up a Roth IRA for your child that will help pay for college, but also be the seed of their retirement account. However, your child must have earned income, such as from babysitting or an actual job.
Start Your Children on the Road to Sucess
Many parents use a combination of these, such as setting up a 529 savings plan for educational expenses, and then a Roth IRA to start building contributions before rolling in what is left after college. We have the expertise you need to choose the best savings plan or combination of savings plans for you and your children.
Prior to investing in a 529 Plan, investors should consider whether the investor's or designated beneficiary's home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state's qualified tuition program. Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. Please consult with your tax advisor before investing.
Contributions to a Roth IRA are taxed in the contribution year. The Roth IRA offers tax deferral on any earnings in the account. Withdrawals from the account may be tax free, as long as they are considered qualified. Limitations and restrictions may apply. Withdrawals prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Future tax laws can change at any time and may impact the benefits of Roth IRAs. Their tax treatment may change.