Dry winter hurts wheat

Bloom season will soon begin

Report shows state's role in vegetable production

'Ag plate' supporters seek pledges

Avocado growers supply Super Bowl Sunday

Sheep ranchers in a tight spot

Pest-sniffing dogs protect California crops

California students to attend national ag forum

Ranchers and farmers welcome rain

Growers ready for Valentine's Day bloom boom

Farmers plant more pecans

Task force says, 'Buy it where you burn it'

Farmers assess freeze impact

Beekeepers buzz with activity

Investigators work to return stolen cattle

Grapefruit crop will be smaller

Strawberry harvest under way

Sunshine helps vineyard-pruning process

Dry weather leaves rangeland vulnerable

Growing interest in agritourism



college, which puts a damper on things if your California kid suddenly decides they want to attend Harvard. It depends on the contract, though. Some 529 plans do allow students to attend private or out-of-state universities, but you might have to forfeit some of the value of your account.

A safer and more flexible option than the prepaid plan is the 529 college savings plan. Through it, your child will be free to attend any university, public or private, in-state or out, and it includes room and board. The downside? The money you put into the college savings plan is only good towards whatever the cost of college is at the time your child is ready to enroll. No one know what that’ll be, but it won’t be cheap.

Most states put a cap on lifetime contributions to 529 college savings plans that range between $100,000 and $275,000, though most don’t have a limit on how much you can invest annually. Problem is, contributions of over $12,000 per year ($24,000 if you’re married) are subject to a gift tax. There’s a loophole here, however. You can invest up to $60,000 in one year to a 529 and it will be treated as five yearly payments of $12,000. But beware; going this route will leave you unable to make another deposit for the next five years.

So where does your money go when you put it into a 529 savings plan? Much like a 401(k), the goals is to invest aggressively early on, then choose the safer path the closer you get to needing the money. If you choose an age-based portfolio, your money will be invested in stocks early in your child’s life, and then moved to the bond market as he or she gets closer to college.

The 529 plan offers enormous tax savings if you use the money for its stated cause—putting your child through college. Though your contributions to the fund are not considered tax-deductible, it will grow free of taxes and any withdrawal is also not subject to federal taxes. Depending on where you live, you might also get state tax deductions or exemptions from contributions or withdrawals.

The one big-time fallback to the 529 is the fact that it may limit your chances of receiving financial aid. That’s because withdrawals from the account are considered part of your child’s income, and will be assessed for financial aid purposes. It may or may not be an issue, depending on how much you have saved in the 529 account.

Joseph Kenny writes for the Loans Store who can offer cheap loans to UK residents and secured loans if you have a poor credit history.
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