If you are looking for a convenient way to help your child or relative save money for college you will want to consider the Iowa 529 college savings plan. This outstanding plan offers 13 great investment choices which are managed by the Vanguard group. This gives parents the flexibility that they need to stash money aside to they can afford to pay for the rising costs of college tuition.
Knowing what plans are right for you can make a big difference in your child’s future education. As education costs continue to rise, the Iowa 529 plan can be a great way to get a head start on saving for college. There are many different plan benefits and investment strategies that you can take advantage of. Here are just a few benefits that these plans have which you can use as part of your investment strategy.
Iowa 529 College Savings Plans Tax Benefits
There are numerous tax incentives that are offered with this savings plan. These benefits can help you increase the amount of money that you have to invest in your child’s future. Iowa taxpayers’ earnings are fully exempt from eyeless state income tax as well as federal state income tax. Iowa taxpayers can deduct up to $2811 in contributions per beneficiary account from their adjusted gross income. This is a huge tax advantage. If you have a family of four you can deduct up to $11,244 as long as you have separate accounts set up.
Federal gift tax incentives also exist. You can contribute up to $65,000 in a single year for each beneficiary without incurring a federal tax. This can be a huge incentive for relatives or grandparents looking to help pay for their loved ones future.
Age-Based Investing with the Iowa 529 College Savings Plan
This is a great way for parents to save for college. These programs help you pick a savings plan and investment strategy based on your child’s current age. The younger your child is the more aggressive the growth portfolio will be. As your child gets older and closer to the age where they attend college the portfolio will adjust to a more moderate investment strategy. This enables you to accumulate the money needed to pay for college. Protecting your capital investments is a vital part of your investment strategy.
Iowa 529 Plan Named Top 5 College Savings Plan
The Iowa college savings plan and was named one of the top five 529 programs by Money magazine. Part of the reason that this plan has been so successful with Iowa citizens is the amount of flexibility that is offered and the low-cost that are involved. Having 13 different investment options provided by the Vanguard group gives account holders the flexibility they need to produce maximum gains.
If you live in Iowa and are looking for a great savings you’ll want to consider the 529 college savings plan. This is a great way for you to save money for your loved one and make sure they can afford the rising costs of college tuition.