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Why Many 529 Plans Lose Money to Taxes and Fees

February 24, 2023

529 plans are an excellent tool to help save for education expenses, but are families taking advantage of all the benefits these college savings plans have to offer? Nearly two-thirds of 529 accounts are not fully capitalizing on the potential benefits due to the numerous differences in each states’ plan. Many of these accounts are expected to lose 9% of their after-tax value over 18 years, the age at which most students enroll in college.

Jonathan Thomas, CFP®, Private Wealth Advisor at LVW Advisors, likes to consider 529 plans in estate planning because 529 contributions moves money out of a donor’s taxable estate, which is “particularly advantageous for grandparents with substantial assets who have multiple children and grandchildren”.

Read the full article here.

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