Have you already started to think of some of the costs associated with having a child?
Are you or someone you know expecting a little one in the near future?
Costs of Children
Have you already started to think of some of the costs associated with having a child? The obvious costs come to mind such as food, diapers, clothes, toys, and the list goes on and on. Although you can find many thrifty ways to save on some of these costs with garage sales, hand me downs, buying in bulk, etc., there is one cost that isn’t as easy to be thrifty with and isn’t as
As you may know, education costs continue rising year after year at a pace faster than inflation. According to an article written by CNBC, tuition rates for a
529 Plan Benefits
Lucky for you, many states offer a 529 College Savings Program that you can participate in to start saving early. Although the funds won’t be used for many years, that little one will be walking across the stage before you know it and what better gift to give them than the gift of education. I’ve listed some facts below regarding the Wisconsin 529 College Savings Program that you can take advantage of as the account owner and some that will benefit the beneficiary as well.
- The 2018 contribution limit is $3,200 which means the account owner can take a Wisconsin State tax deduction for dollars put into the plan up to that amount for each beneficiary’s account
- A unique caveat to the WI plan is that any dollars in excess of the $3,200 can be carried forward and applied as a tax deduction in following years
- Any contributor can take the tax deduction and put in up to the $3,200 limit in a given year – not just the account owner
- Money that is invested in the account receives the state tax deduction, grows
tax deferred, and is tax-free upon distribution if used for qualified education expenses
- There are no income, age, or time limits on the plan
- You may change the beneficiary on the account to another family member at any time
- Account owner retains control of how the funds are used at all times
- Qualified education expenses include, but aren’t limited
to:tuition, fees, room and board, books, computers, software programs, and other necessary expenses required for schooling
Let us know what other questions you may have regarding the 529 College Savings Plan. There are many ways that this can be utilized for individuals saving for college while being able to benefit from the tax advantages.
Please contact our office if you have any questions regarding this topic.
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529 Disclosure: Investors should carefully consider investment objectives, risks, charges