College Planning Solutions

Your child's college tuition could be one of the largest expenditures you ever make. And, if you have more than one child, the financial commitment is even greater. The financial challenge you face is shared by millions of others.

Fortunately, American families with a desire to save for future college expenses now have more options than ever before. Traditional investment options-savings accounts, taxable investment accounts, annuities, and U.S. Savings Bonds - are now joined by powerful new investment vehicles including Section 529 college savings programs and Coverdell education savings accounts.

New investment programs bring new opportunities, but they may make decisions more difficult for people who want the best education possible for the children in their lives.

Here, at Walnut Investment Services, we will help you gain a basic understanding of your options so that you can maximize the return on every dollar you set aside for your child's future. Remember, even if your goal seems overwhelming now, the proper planning and saving can put the cost of any college within your reach.

529 Plans

A college savings plan sponsored by a state or state agency Savings can be used for tuition, books, etc. at most accredited two and four-year colleges and universities, vocational-technical schools nationwide and eligible foreign institutions

• U.S. residents of any state, who are 18 years of age or in some states, the age of majority, may invest in most state's plans
• Any earnings grow tax-deferred
• Contribution limits are now $200,000 and higher in some states
• Contributions are tax-deductable on most state's income tax returns
• Distributions for qualified higher education expenses are federal income tax-free
• Custodian retains full control of the account and can switch beneficiaries at will

College Savings Accounts

College Savings Accounts content here.

Investment Accounts

Investment Accounts content here.

Coverdell Education IRA

• a family member setups a fund similar to an IRA account with a bank, investment house, mutual fund, or other financial institution
• the family member names a beneficiary to the account who must be under the age of 18
• the family member or other adult is named as the "responsible individual" - the individual who has decision-making authority over the account until the beneficiary reaches age 30
• contributions to the fund are after-tax, meaning that the money used to finance the account cannot be deducted from your taxes
• the maximum allowable contribution in a given year (starting in Year 2002) is $2,000
• earnings from the account are FREE from federal income taxes
• distributions from the account are also tax-free if the funds are used to pay for qualified higher education expenses
• starting in 2002, family members may contribute to both EIRAs and State 529 Plans - EIRAs maximum allowable amount is $2,000 a year

Unlike 529 plans the account belongs to the beneficiary which cannot be altered.