The concept of the 529 College Plan centers on the notion that a tax advantaged investment strategy can help encourage the savings for a beneficiary’s college education. Parents and grandparents can start a 529 College Plan, contribute money to it, and not have to worry about any tax debt. When it comes time for the child to enroll in college, the parent can withdraw the money to pay for tuition while not having to pay income tax on the revenue. Needless to say, that is a great deal!

Of course, depending upon the type of college savings plan you are working with, the money you have put away will be invested in the stock market under the careful management of a portfolio manager. This way, the money will be put to work for you in a series of blue chip stocks that will increase the value of the money over time. As a result, when it comes time to pay for college, the funds will be there to make the payments on the tuition. Of course, the money needs to be used to pay for the child’s tuition in order to be tax free. If you attempt to use the money for other purposes you will assuredly face penalties. The same can be said of early withdrawals as certain College 529 Plans will require that you invest a certain amount of money for a certain specified time period in order to achieve the benefits of such a plan. However, those that put they money away, contribute additions to it regularly over time, and do not touch the capital will end up with a great deal of money to work with when freshman year rolls around.

Again, not all College 529 savings plans are identical. They may even vary from state to state. As such, you will need to do a little research into the applicable laws of the region you reside. However, virtually all of these plans have their benefits which are why looking into them remains so highly recommended.

Another great strategy to use when considering college is to consider buying a home for your children in the college town they might someday attend college. University Hill Boulder real estate has dozens of homes that have been purchased this way. If the kids don’t end up going to school in Boulder CO, they are still a great rental property, and depending on when purchased, could be paid off by the time your kids go to school! The rental income can either pay your kids’ expenses while in school, or the home can be sold to pay for college expenses wherever your kids do end up.