FYR008: Savings Strategies for College and Beyond with Chris Wagner

Did you know that May 29th is 529 Day? This quirky, not-quite-a-holiday day is a great opportunity to learn about planning for your family's future education needs while enjoying some light-hearted fun. Listen or watch our latest podcast episode to find out how 529s, and other savings accounts, can help you save smartly for education expenses.

In this podcast, dated 5/29, Chris Wagner, a wealth advisor at Vector, discusses financial planning to help you maximize your college savings potential. He emphasizes the importance of starting early to benefit from compound growth and discusses contribution limits and the tax implications of various approaches.

Key Features of a 529 Plan:

• Tax Benefits: Contributions are made with after-tax dollars, but investments grow tax-free, and withdrawals for qualified education expenses are also tax-free.


• Qualified Expenses: Funds can be used for a range of education expenses, including tuition, fees, books, and room and board at eligible colleges, universities, and vocational schools. Recent changes also allow for up to $10,000 per year to be used for K-12 tuition.


• Flexibility: You can open a 529 plan from any state, not just your own, and use the funds at any eligible institution nationwide.


• Contribution Limits: While there are no annual contribution limits, contributions are subject to federal gift tax rules. In 2024, you can contribute up to $18,000 per beneficiary without triggering gift taxes.


• Under recent tax law changes, unused dollars in a college 529 account can be rolled over to a Roth IRA for the same beneficiary. There are a few stipulations; be sure to consult with a qualified financial advisor before making changes.

Time & Chapters

00:00 … Wealth Advisor Chris Wagner

00:52 … What is a 529 Plan?

02:35 … How to contribute to a 529

05:45 … Setting College Savings Goals

09:55 … Taxes & Converting 529 to Roth IRA

17:15 … Potential state tax deductions

19:44 … Alternatives to 529 Plans: UTMA Accounts

23:22 … Savings & Gifting Strategies

26:33 … Closing Remarks and Regulatory

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To learn more about optimizing your college savings strategy, connect with the Vector team for personalized advice.

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vectorwealth.com/regulatory

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