Is Schwab 529 plan good?

This is a program that offers outstanding flexibility, attractive investments, and additional economic benefits (such as generous state tax incentives) that for some people, at least, will provide a substantial boost to their savings. There are few, if any, weaknesses noted in the program.

Is there a self directed 529 plan?

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.

How does Schwab 529 work?

The Schwab 529 Plan gives you a choice of investment options, each designed to provide the appropriate balance of risk and growth to help meet your target investment goals. There is also a money market fund portfolio that is designed to offer the stability of capital for a shorter-term time horizon.

Can you invest index funds 529?

Investing in index funds in your 529 plan Or you can build your own NY529 portfolio and invest in index funds as a part of it.

Should I open a 529 in my name or my child’s?

Thus using the Uniform Gift to Minors Act to transfer money into the child’s name is generally a mistake for most families. It is almost always better to save for college in the parents name. The following table lists the current financial aid treatment of the most common savings vehicles.

Is a 529 better than a mutual fund?

Answer: Section 529 plans are often a more powerful tool than mutual funds because of the favorable federal tax treatment given to these plans. First of all, assets in a 529 are tax deferred. Plus, withdrawals from a 529 plan that are used to pay qualified education expenses avoid federal income tax.

How do I invest in a 529 plan?

As mentioned, you can start a 529 plan either through an advisor or, less expensively, by investing directly with the plan’s sponsor. While states administer 529 plans, they typically turn over the day-to-day operations to major financial services companies, such as Fidelity, T. Rowe Price, or Vanguard.

What should I invest my 529 plan in?

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. Many states also offer target date funds that adjust the mix of your investments so they’re less risky as you approach the time to use the money.