College tuitions are rising considerably each year, while more and more people are taking on education loans to cover these costs. Retirees and those nearing the age of retirement may be looking for the opportunity to help ease this burden by contributing to their loved ones’ educations.
If you are planning to help your children or grandchildren pay for college, AARP (R) College Savings Solutions from TIAA CREF may provide information about a great opportunity for doing so.
College savings plans provide a federally tax-advantaged opportunity to save for your loved ones’ educations. Also, depending on the state plan in which you open an account, you may be eligible for state tax benefits.
If you are a U.S. citizen or resident alien with a valid Social Security number or taxpayer identification number, you can open a college savings plan account. The beneficiary of the account can be anyone who is a U.S. citizen or resident alien with a valid SSN or TIN, including your child, grandchild, niece/nephew or friend.
You can continuously add money to your 529 accounts up to the state’s maximum account balance for a beneficiary. If the money in these accounts is used for the qualified higher education expenses of the designated beneficiary at an eligible educational institution, the earnings on amounts withdrawn are not taxed.
For more information on 529 plans, visit TIAA CREF at the AARP College Savings Solutions website.
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