Unlocking the Wealthy Benefits of 529 Savings Plans

A Powerful Tool for Wealthy Families: Maximizing 529 Plans

A pair of doting grandparents could establish a 529 for a new baby in the amount of US$180,000. Combining the two approaches offers an effective tool for wealthy households to help younger generations. If for some reason you fund a 529 plan but need to take the money back, the amount that has compounded from the original funds is taxable, and you’ll owe a 10% penalty. For example, expenses that qualify to be reimbursed from a 529 plan include not just tuition and fees, but housing and many supplies, like books and computers.