Apprenticeship programs have gained popularity as an alternative to traditional college education. Recently, the U.S. Department of Labor reported a significant 64% rise in registered apprentices, showing a growing interest in alternative career paths.
Many do not know that a 529 college savings plans are not just for higher education. They can also fund trade school and apprenticeship expenses. CollegeInvest accounts provide help with various post-high school educational journeys. Find funds to help with training for your child or grandchild.
These educational institutions specialize in training for specific trades or careers. These institutions design programs to equip students for employment in fields requiring hands-on skills and knowledge. Examples range from automotive technology and culinary arts to information technology and construction. Unlike 4-year college programs, these vocational courses often have a shorter duration.
Apprenticeships offer practical training and work experience in a trade. They are paid positions, often leading to job promotion or salary increases. For instance, the average salary is $77,000, as reported by the Department of Labor.
In Colorado, the Department of Labor and Employment provides a directory of Registered Apprenticeship Programs. If listed, 529 apprenticeship programs funds can cover fees, books, supplies, and necessary equipment.
CollegeInvest offers several benefits, including:
Qualified expenses like books, tools, and uniforms are payable through 529 plans
Contributions to a 529 are tax-deductible
529s funds cover ongoing certification classes
The growth of tax-deferred earnings; tax-free withdrawals for eligible expenses
Transfer 529 accounts among family members
The funds can be used at eligible colleges, universities, technical schools nationwide, and even abroad, as long as the school is qualified to participate in federal student aid programs. Colorado taxpayers may also be eligible for a Colorado state tax deduction
It’s important to note that while these expenses are generally considered qualified, it’s always a good idea to consult with a tax advisor or financial professional to ensure compliance with any specific rules or regulations that may apply in your situation.
What is a 529 college savings plan?
A CollegeInvest 529 Savings Plan is an educational savings account where your money grows federal and state tax-free as long as it’s used for specific expenses, including tuition and room and board. Use your savings anywhere in the country at eligible colleges or trade schools and even for apprenticeships.
529’s were created to encourage parents to start saving early while their students were young, allowing the savings to increase as they grow. The affordability, flexibility and unique savings plans of 529s make them one of the best and easiest ways to save for a postsecondary education.
How can I use my 529? (Eligible expenses)
The qualified expenses of a 529 plan:
Who can participate?
Parents, grandparents, other relatives, even friends! There are no age or income restrictions to owning a CollegeInvest account. Nor do you have to be a Colorado resident or taxpayer.
In fact, you could open an account for yourself. If you’re seeking an advanced degree, looking for additional certification, wanting to finish college, or simply trying to keep up with new technology, a CollegeInvest college savings plan can get you there.
You can open as many accounts as you want. YOU control who receives the funds, when they’re withdrawn, and for what expenses. You can change the Beneficiary at any time.
Nor are there any restrictions on the number of accounts per Beneficiary.
And anyone can contribute to your account. Learn more about Friends and Family Gifting.
What vocational, trade or technical schools will my 529 funds apply to?
529 funds apply to trade or technical schools participating in federal student aid programs. To make the most of your 529 plan, ensure your chosen school is eligible. You can easily check this through the Federal Student Aid School Code Search, which lists all qualifying institutions.
What apprenticeships will my 529 funds apply to?
The Colorado Department of Labor and Employment has a Registered Apprenticeship Program Directory here. If it is listed, 529 plan funds can be used towards program fees, books, supplies and equipment, including the tools needed for the trade. The Department of Labor provides a search tool to find out if your particular apprenticeship program is eligible.