529 College Savings Plan And Texas
January 29th, 2006
The discussion of the 529 College Savings Plan and Texas starts with the Texas guaranteed tuition plan. With the booming popularity of 529 college savings plan and Texas residents wanting to find the best way to save for college, Texas residents can choose between the Texas Guaranteed Tuition plan or the Tomorrow’s College Investment Plan.
About Texas Guaranteed Tuition Plan 529 prepaid tuition program:
Texas offers two ways for Texas residents to save for college. The Texas Guaranteed Tuition Plan 529 prepaid tuition program is not a 529 College Savings Plan and Texas does have a 529 College Savings Plan called Tomorrow’s College Investment Plan, which we will discuss later.
The Texas Guaranteed Tuition Plan, unlike other 529 College Savings plan and Texas’ Tomorrow’s College Investment Plan, locks in the cost of tomorrows college tuition and required fees at todays prices. With Texas Guaranteed Tuition Plan, you can use your benefits at any accredited college or university in the nation. The Texas Guaranteed Tuition Plan benefits are protected by a constitutional guarantee from the State of Texas. However, check on all guarantees before considering a preparid plan as not all prepaid plans have the same guarantees. Distributions from the Texas Guaranteed Tuition Plans are tax-free when used for qualified education expenses.
529 College Savings Plan and Texas’ Tomorrow’s College Investment Plan
Texas’ Tomorrows College Investment Plan is managed by Enterprise Capital Management. 529 College Savings Plan and Texas’ Tomorrow’s College Investment Plan provide a tax-advantaged investment vehicle for college savings. The Tomorrow’s College Investment plan includes a choice of 20 different investment portfolios and offers the opportunity for tax free growth of your investments and tax free withdrawals on earnings used for qualified education expenses.
Unlike Texas Guaranteed Tuition Plan, the Texas’ Tomorrow’s College Investment Plan is a 529 college savings plan.
Is a 529 College Savings Plan and Texas’ Tomorrow’s College Investment Plan better than the prepaid 529 Plan?
The current federal financial aid regulation makes the 529 College Savings Plan and Texas’ tomorrow’s College Investment Plan better than the prepaid 529 Plan. A prepaid plan for college savings is not for everyone. The Texas Guaranteed Tuition Plan is strictly for Texas residents.
With the college costs skyrocketing, most 529 College Savings Plans and Texas’ Tomorrow College Investment Plan as well as prepaid plans are difficult to meet the college savings needs. Many states are also facing large budget deficits and are looking to cut costs. At the present time, Texas Guaranteed Tuition Plan is closed to new beneficiaries.
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