529 Plan and College Savings

Archive for April, 2008

Question: How early can I start a 529 Plan?

I live in the state of RI. I have no children yet but want to start a 529 Plan now for future children. Does RI allow that? Can I put myself as the beneficiary for now and then change it to the child at a later date?

Answer: You can setup the 529 with yourself as the beneficiary and a family member as a contingent beneficiary. If you never have children the money can be used for a relative’s education. If that doesn’t apply then you could always cash out the funds for non education purposes but take a tax hit.

Note that you can set up a 529 Plan in any state, not just your own home state. Look at this state by state comparison of 529 plans

http://www.collegeanswer.com/paying/content/529_plan_statebystate.jsp