529 Savings Plan
Did you know that the 529 Savings Plan is not just for higher education costs? Ever since the 2017 tax reform, 529 plans can be used for private elementary, middle, and high school tuition—up to $10,000 per year.
A 529 plan is a tax-advantaged investment account similar to an IRA that lets an individual save money for education expenses. Most plans offer automatic deposits from your checking account or via a payroll deduction. The money in the account is managed by an outside investment firm and are an easy, ands-off way to save for K-12 education expenses.
When you need to use the funds, simply withdraw from the account and transfer them to your checking account. From there, it's cash you can put toward your child's education! The limit for withdrawals is $10,000 per year when used for private school tuition, and earnings and withdrawals are tax-free. When paying for K-12 education, these funds can only be applied towards tuition (not books, uniforms or other school expenses).
For more information on how to open a 529 Savings Plan for your student's K-12 tuition costs, contact your financial advisor or visit the Texas College Savings Plan.
At The Banff School, we want the process of joining our “family” to be easy and quick!