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College and Educational Savings Plans | Wescom Financial Services

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College Savings Plans

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College Savings Facts

Parents of a baby born today would have to start saving $385 a month in order to afford housing and tuition at the average state school — but if they don't start saving until the child is in middle school — the required monthly savings amount jumps to $780.

Kent Smetters, Professor at the University of Pennsylvania's Wharton School

Saving for College and Educational Cost

As college tuition cost and inflation continue to rise, it is becoming more and more difficult for families to afford the cost of college education. We can help guide you through savings and investment options intended to help you meet the rising cost of tuition.

We offer several products specifically designed to help families save for educational costs. Many of these products offer tax-deferred benefits. Contact us today so we can help you determine which educational savings product is right for you.

Educational Savings Accounts

529 Savings Plans

529 plans are flexible, tax-advantaged savings plans designed specifically for college savings. These plans are generally sponsored by a state or state agency. Contributions are made post-tax but earnings are tax-free (federal and most states).

529 Savings Plans offer a wide use of funds that can be used at any college in the United States or abroad that is accredited by the Department of Education. Additionally, most plans will allow the money to be used towards graduate school programs as well.

Coverdell Education Account (ESA)

A Coverdell Education Account (ESA) — formerly referred to as an Educational IRA — is a tax- advantaged account used to help families save for a child’s K-12 or college education.

Contributions are made post-tax and are not tax-deductible, however earnings grow tax-free and should remain tax free (federal and most states) upon withdrawal. Contribution limits are set at $2,000 a year and cannot be made after the beneficiary reaches 18 years of age.

Withdrawals can be used for qualified educational expenses such a tuition, books, fees and uniforms for expenses relating to elementary, secondary, and college education.

See Comparison of Educational & College Savings Plans