Back to schoolWith the youngsters going back to school after Labor Day for many students, parents might want to consider a plan to fund college or other educational options after high school. It might be wise to begin these savings now. You can start with as little as $25.00. North Carolina allows contributions up to $15,000 per beneficiary.

Your earnings are not taxed while they are invested. Your investment in your 529 plan can grow tax-deferred. This means it  they won’t be subject to state or federal income tax while those funds are invested. Additionally, your withdrawals are also tax free as long as you use the funds on qualified higher education expenses.

Qualifying expenses apply to colleges, universities and community colleges and some trade schools. These includes:

  • tuition for both full and part-time students at accredited institutions,
  • room and board if attending half-time or more,
  • technology items like computers, printers and laptops
  • books and supplies.

Recently, private elementary through high school tuition also qualifies, but only for tuition expenses.

The North Carolina 529 plans have fees that are among the lowest in the nation. Total annual asset-based fees currently range from about 0.05% to 0.15%. However, if there is not a plan that fits your family’s needs, there are plans in other states as well.

Check with a Certified Financial Planner (CFP) for details. Your CFP can guide you through the process and help set up the right 529 plan for your youngsters.

Les Merritt, CFP and CPA, can do both your financial planning and your taxes. He can leverage one with the other. He is one of very few professionals who is both a CFP and a CPA. These combined skills and knowledge can create a significant advantage for you. Call Les Merritt today at (919) 269-8553 or send him an email at

So now that you have purchased schools supplies and sent the kids back to school, review or create your plan to finance their higher education. Contact Les to start or evaluate your plan.

Updated: September 13, 2019 — 9:43 am
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