Planning to fund college for one child can be a daunting task, but when you have multiple kids, it can seem monumental. We’re going to give you a few tips for ways to save for college when you have to think about all of your children.
- Education Savings Account (ESA) – This is a savings account that allows you to save for multiple students with tax-free growth. You can only add $2,000 to the account each year, but that is per child, so if you have three kids, you can stow away $6,000/year. Just remember that your kids will have to use the funds by age 30 and that there are some restrictions on income.
- 529 Plan – If you have more money to put away, this is the option for you. The limits are much higher, and the growth is still tax-free. There is also no age limit on using the funds. It’s great for families whose income is too high to qualify for an ESA. Just keep in mind that you need a separate account for each child, and you may get hit with a penalty if you transfer funds from one child to another.
Helping Parents Develop a College Funding Plan
We know it can be tough to help your kids with ever-rising tuition costs. That’s why College Planning Source offers financial planning advice for families that intend to send one or more children to college. To learn more, give us a call today at 858.676.0700, or you can submit the online contact form.