What Is the Best Way to Save Money for Children?
Saving and investing in your child’s future to help with education or to give them a terrific start in life is a fantastic idea. Helping to ensure your children’s financial future is one of the most valuable money management plans and, correctly done, will prevent tax losses and loss of financial aid.529 Savings PlanSetting up an education savings plan for each child is a popular choice when making gifts to children. Present tax law allows deposits up to $65,000 per person to a state-sponsored 529 education savings account. Married couples can double the gift, making the total $130,000. All earnings gained from a 529 account are tax-free if the money pays for tuition and school expenses. As the owner of the account, you have full control over the money. The money in the account can also be used to pay for your own education expenses. Also, financial aid is determined based on the year prior to the aid application–usually the junior year of high school–and students with large sums of
