529 Plan and College Savings

Archive for March, 2008

Question: What are the advantages/disadvantages of a Coverdell vs a 529 college savings plan?

Can someone please give me a hint as to which is better. I looked on Ameritrade and with the exception of the maximum allowable contributions, I really couldn’t find a major difference.

Answer: Coverdell predates 529. Anyone who had a Coverdell may have kept it.

529 can only be used for college. Coverdell can be used at any age.

Coverdell must be used by age 30. Anyone can open a 529 if they *think* they will take post-secondary classes.

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