What is the difference between direct-sold and advisor sold 529 plans?
Direct-sold 529 plans typically have lower fees, but advisor-sold 529 plans offer unique advantages that may be worth the extra cost to some investors. Advisor-sold 529 plans are available only through licensed financial advisors, such as broker dealers or registered investment advisors (RIAs).
Are there any self directed 529 plans?
This college savings plan is a popular alternative to state 529 plans, and anyone can contribute to the account, including the designated beneficiary. A self-directed ESA works just like a regular ESA, except you can invest in a wide variety of alternative assets in a self-directed plan.
Can you buy stocks in 529 plans?
Investment choices can be limited A 529 plan may allow you to invest in a number of different assets, including stock funds, bond funds, and FDIC-protected money market accounts.
Is USAA 529 plan good?
Overall, the USAA 529 College Savings Plan is above average in performance, ease of setting up and use, and customer service.
Can an RIA manage a 529 plan?
Advisor-sold 529 plans are available through Registered Investment Advisors (RIAs) and Broker-Dealers. RIAs have a fiduciary duty to put their clients’ best interests ahead of their own. Most RIAs operate as fee-only and cannot collect commissions on the sale of investment products, including 529 plans.
What are 529 plan rules?
To qualify as a 529 plan under federal rules, a state program must not accept contributions in excess of the anticipated cost of a beneficiary’s qualified education expenses. At one time, this meant five years of tuition, fees, and room and board at the costliest college under the plan, pursuant to the federal government’s “safe harbor” guideline.
Does 529 plan pay for housing?
You can purchase a house in your name and charge your child rent while he attends college. Rent is a qualifying tax-free expense under a 529 plan. Thus, you can take tax-free withdrawals from the plan and use these funds to pay your child’s monthly housing expense.
What are 529 plans sponsored by?
529 plans, legally known as “qualified tuition plans,” are sponsored by states, state agencies, or educational institutions and are authorized by Section 529 of the Internal Revenue Code. There are two types of 529 plans: prepaid tuition plans and education savings plans.
What are Section 529 plans?
Section 529 plan. Definition. A state-sponsored program designed to help parents finance education expenses. Section 529 plans are administered by certain investment companies and subject to contribution requirements and investment guidelines.