When we talk with Parents and Grandparents about saving for college, flexibility is at the top of their concerns. It’s also the most inherent benefit of 529 savings plans.
At any time, you can change the Beneficiary of your account. The list of Beneficiary options is extensive: children, grandchildren, siblings, step-siblings, Parents, step-parents, cousins, nieces or nephews, in-laws, or the spouse of any of these.
If your Beneficiary receives scholarship funds, your money is not frozen. There are three simple options that don’t incur penalties:
Alternatively, you may withdraw funds from your account equal to the scholarship amount without incurring the 10% federal penalty on the earnings portion.
The earnings portion of your withdrawals may still be subject to state and federal income taxes. (You should carefully read the information in your plan’s Plan Disclosure Statement, or consult a tax advisor for your specific situation.)
You don’t have to live in Colorado to open a CollegeInvest account. Nor does your child or student have to go to college in the state of Colorado. Your savings can be used for qualified educational expenses at an eligible school anywhere in the country, and even outside of the United States in some cases.
“Eligible” means that the school participates in the federal loan program.
Our savings plans aren’t limited to just colleges or universities or graduate programs.
Your CollegeInvest account can be used at community colleges or trade schools, two-year nursing or medical technician programs, or a two-year online program on entrepreneurship and small business management. Even qualified special interest programs such as art schools, hair stylist and barber schools, chef or culinary schools, master plumber programs, and more. And even expenses for apprenticeships!
How about a marine biology program in the Caribbean? Or a PGA qualifying school in Florida or Arizona? Did we get your attention?
Some Parents and Grandparents prefer to be more hands on with their investment options, whether it’s in reaction to market conditions, estate planning benefits, or family circumstances and life events.
As the Account Owner, you can change your investment options twice within a calendar year without penalties.
Common reasons 529 Account Owners change investment options:
For Colorado taxpayers, contributions to any CollegeInvest 529 account can be deducted from your Colorado state income tax return. Your earnings grow free of federal and state taxes.
You as the Account Owner control the number of accounts, the Beneficiaries, how much to save, what you pay for and when, and more. With the flexibility to change any of these when YOU want to.