Virginia has played a prominent role in helping parents save money for their children’s future higher education. The Virginia 529 college savings plans are listed as the best advisor sold plan in America. Kiplinger rated the Virginia College savings plan as one of the top five 529 college savings programs in the country. There are four different 529 savings programs that are available to Virginia residents based on their personal needs. All of these wonderful programs offer valuable benefits that can be used as stepping stones for parents trying to reach their financial goals. Here are some of the many benefits and some insight into the various programs offered by the state of Virginia.
Virginia 529 College Prepaid Education Program or VPEP
The VPEP prepaid education program is one of the many section 529 qualified tuition programs offered by the state of Virginia. Virginia families prepay the cost of tomorrow’s college tuition and mandatory fees at today’s prices. Contribution payments cover future in-state undergraduate tuition and other mandatory fees that are associated with full-time public colleges and universities. State legislation has provided a financial guarantee in each year’s state budget to help cover the fee PEP contractual obligation. Virginia citizens can deduct up to $4000 per year from Virginia taxable income. All earnings in the VPEP 529 college savings plan grow tax-free. The earnings of this outstanding 529 college savings program grow federal tax-free as well. This helps parents save money and maximize the amount of contributions that they can make in a given year.
The Virginia Education Savings Trust 529 College Savings Plan
The VEST is a qualified section 529 college tuition program. The VEST is an individual savings account, invested in your choice of stock or bond portfolios. These portfolios are intended specifically for the payment of qualified higher education expenses. The VEST program has no state residency requirements and no age limits. It can be used for a wider range of qualified higher education expenses then VPEP program. The tax benefits of the VEST 529 college savings program are identical to the prepaid education program that we discussed earlier. The benefits of the account holders can be withdrawn in order to pay for the beneficiaries tuition costs, certain room and board costs, and required books and supplies. These benefits make the Virginia education savings trust one of the best options for Virginia residents.
These two intriguing college programs offer parents flexible options when it comes to investing their money. All account holders have full control of the money that is invested. Parents can select from a variety of different portfolios that range from aggressive stocks to conservative money market funds. Investment strategies should be planned out ahead of time based on your child’s current age. The faster they you start saving money for your child’s future college tuition the quicker you will see results. Saving for college takes dedication and a long-term plan for achieving success. Saving for college can be the most critical financial decision that you make in your entire life. With college tuition costs rising rapidly there is no better time than now to start saving for your child’s future.