529 Plans Through Wells Fargo Advisors

What's a 529 plan?

529s are one of the most popular ways of investing for education. They are state-sponsored programs, usually managed by a financial services firm. Tax advantages and a surprising degree of flexibility are just two of the benefits that families derive from 529 plans.

Key benefits of a 529 savings plan

• Tax benefits : There are no federal taxes when distributions from the plan are used for qualified education expenses. The availability of such tax or other benefits may be conditioned on meeting certain requirements.
• Flexibility : Use the money at eligible accredited post-secondary institutions nationwide, including undergrad, graduate, post-grad, vocational or trade schools, and registered apprenticeship programs. Up to $10,000 can be used annually to pay for elementary and secondary school tuition. Funds may also be used to pay up to $10,000 lifetime limit towards qualified student loan repayments for a designated beneficiary or siblings.
• Eligibility : Anyone who is a U.S. citizen or legal U.S. resident can make contributions, regardless of income.
• Suit payments to your budget : With access to approximately 25 plans, Wells Fargo Advisors makes saving for college easier with low minimum contribution options available.

College savings plans offered by each state differ significantly in features and benefits. The optimal plan for each investor depends on his or her individual objectives and circumstances. In comparing plans, each investor should consider each plan's investment options, fees, and state tax implication. 

529 Plans are subject to enrollment, maintenance, administrative, and management fees and expenses.

Invest with guidance 

When you invest in a 529 college savings plan through a Financial Advisor with Wells Fargo Advisors, he or she can provide you with planning tools to help you determine your investment goals for college, then map out a strategy designed to help meet those goals.

Account description

A flexible tax-advantaged way to invest for education. Qualified state tuition programs designed for customers who want to:

• Invest for a loved one’s education or even yourself
• Make sizable contributions each year
• Shift portions of your estate to future generations

Income eligibility restrictions

• None

Contribution age limits

• No age limit

529 plan annual contribution limits per student

• The annual contribution limit may vary by plan. Keep in mind that up to $85,000 (single) or $170,000 (married couples) is allowed in one year without a reduction in the federal applicable gift/estate
  tax exclusion.

Minimum initial investment

• Varies by plan

Taxation of earnings and withdrawals

• Contributions have the potential to grow tax-advantaged for qualified education expenses
• Withdrawals may be free from federal income tax if used for qualified expenses
• The earnings portion of distributions may be taxable in years the American Opportunity Credit or Lifetime Learning Credit is used if same expenses used to qualify for credit
• Contributions may qualify for a state-income-tax deduction

Qualified withdrawals

• Qualified expenses for higher education include tuition, fees, books, computer equipment and technology, and supplies required for enrollment or attendance at the eligible post-secondary institution. Expenses for registered apprenticeship programs are also qualified. Room and board are qualified expenses for students who are enrolled at least half time. 
• Qualified withdrawals can include up to $10,000 per year in expenses for tuition in connection with enrollment or attendance at an elementary or secondary school. Funds may also be used to pay up to $10,000 lifetime limit towards qualified student loan repayments for a designated beneficiary or siblings. Not all states recognize these withdrawals as a qualified expense; contact your tax professional for state-specific information.

Penalties for non-qualified withdrawals

• Earnings subject to federal and state income tax and a 10% IRS penalty

Account options

• Securities portfolios created by specific fund managers

Ownership of assets (for financial aid)

• Account owner

529 Plans available through Wells Fargo Advisors

• Wells Fargo Advisors offers approximately 25 plans for 25 states from well-known national providers.

Commissions and fees

• Plans are generally sold by a program description that includes a description of fees, expenses, and risks that apply to an investment in a 529 college plan.
• The investment return and principal value of the investment options are subject to market risk and will fluctuate, and when sold, may be worth more or less than the original cost.

Call 1-866-243-0931 to make an appointment with a Financial Advisor to compare 529 plans offered through Wells Fargo Advisors.