Expanding a student’s college options
firstname.lastname@example.org | 7/9/2013, 7:37 p.m.
When 529 plan withdrawals are not used for qualified expenses, earnings may be subject to ordinary income tax plus a 10 percent federal income tax penalty. The tax implications of a 529 plan should be discussed with your legal and/or tax advisors because they can vary significantly from state to state. Most states offer their own Section 529 plans, which may provide advantages and benefits exclusively for their residents and taxpayers.
As with other investments, there are generally fees and expenses associated with participation in a 529 plan. There is also the risk that the investments may lose money or not perform well enough to cover college costs as anticipated.
Before investing in a 529 savings plan, please consider the investment objectives, risks, charges, and expenses carefully. The official disclosure statements and applicable prospectuses — which contain this and other information about the investment options, underlying investments, and investment company can be obtained by contacting your financial professional. You should read these materials carefully before investing.
(Charles Sims Jr. is president/ CEO of The Sims Financial Group. Contact him at 901-682-2410 or visit www.SimsFinancialGroup.com.)