Save for Your Kid's College and Have a Backup Plan

Foreign here's an upcoming option for those of you who may have 529 plans with leftover funds in them or are afraid to fund an account for fear that you'll have too much in a 529. The Secure Act 2.0 has been passed and it includes some new regulations that will be helpful starting in 2024. For those of you who have a 529 plan with money in it and no education to pay for, you will be able to roll those funds over into a Roth ira. That seems like a great idea without this to empty out the 529, you have to take a distribution and pay taxes on the earnings in that account. So this will help make sure that you don't have to pay taxes on the earning of the account and you don't have to fear that you're over funding a 529. After all, if your child gets scholarships or does go to college, you don't want to be stuck with this fund and have to pay all of the tax on the earnings when you could have done something else with it to defer that payment. So under this law, investors can roll up to $35,000 from a 529 into their Roth starting in 2024. I'll include a link to an article about this with more details, but you'll have a little bit of time to set this up. So make sure you talk to your financial advisor about how you will do that and get that Roth IRA set up and funding. And by all means, if you're in a state that allows you a state tax deduction for 529 contributions, make sure you take advantage of that. That will also help you move that money into the Roth Please follow us.

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