The dream of higher education has been faced with a harsh reality of rising tuition costs. In many cases parents feel that the dream may be out of reach. The VHEIP program was created to help parents save money for their children’s future college tuition costs. The Vermont higher education investment plan is one of the best 529 college savings programs in the country.
The state-sponsored education program was created specifically for the purpose of helping Vermont taxpayers save money for future college expenses. Like many other 529 college savings plans, the Vermont program offers many different incentives and tax benefits that can be very beneficial for most families. Here are some of those many benefits that you can take advantage of when opening one of these great accounts.
Tax Benefits of the Vermont 529 College Savings Plans
When you open a VHEIP savings account you will be happy to know that your earnings will grow federal and Vermont income tax-deferred. Any earnings that are used to pay for qualified higher education expenses are also tax-free. Vermont taxpayers are eligible for a nonrefundable income tax credit of up to 10% of the first $2500 that is contributed.
This tax advantage is a great way to save money on your taxes and have more money to contribute into your VHEIP 529 savings account. Federal estate and gift tax benefits are also great advantages. Contributions that are made into the 529 account may reduce the taxable value of your estate. Contributions of up to $13,000 annually can be deducted. There is also a single mom scholarship that can be used to cut down on tuition costs.
Flexibility of the VHEIP 529 Plan
Flexibility can be a key factor when trying to save money for your children’s future higher education needs. The Vermont higher education investment plan offers parents the flexibility that they need to maximize their portfolio benefits. One of the best ways to maximize benefits is by having account that has low-cost fees. The 529 college savings plan has no sales charges or start up maintenance fees that are associated with the account.
You have the choice of six different investment options for your personal situation. These options vary in their investment strategies and degree of risk. This allows the account holder the option to invest their money the way it fits their personal needs. Accounts can be opened by parents, grandparents, relatives and loved ones who are United States citizens.
Contributions can be made into a VHEIP by almost anyone. You can open one of these 529 college savings plans for as little as $25. Monthly contributions can be made via electronic funds transfer, bank draft, or automatic contribution plans. You may contribute as little as $15 per month which makes saving possible for everyone. If the beneficiary of the account does not attend an eligible college institution you may transfer the account holdings to a different beneficiary. These changes can be made once a year.
The Vermont 529 college savings plan offers a variety of options for carrying parents. This makes the VHEIP a great way for parents to get a head start on saving for college now. Take advantage of the many outstanding benefits that are offered by the Vermont 529 college savings plan.