Submitted by hasti on Mon, 01/03/2022 - 11:36

A 529 plan typically has a minimal effect on financial aid, but it varies by situation. Federal financial aid is a needs-based award and is determined by the cost of attendance (the total amount school will cost for one year) and the expected family contribution (based upon the income and assets of both the parents and the student).

A 529 plan does not count as an asset of the beneficiary. If a 529 plan is held by the parents, it does count as an asset of the parents. If the 529 plan is owned by someone else, such as a grandparent, the 529 plan does not count as an asset of the beneficiary. However, the amount withdrawn from a 529 plan owned by someone else, such as a grandparent, is considered income of the beneficiary when it is withdrawn on the beneficiary’s behalf. This may impact any potential financial aid in following years

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For more information about The Education Plan, call 1.877.337.5268 or view the Plan Description and Participation Agreement, which includes investment objectives, risks, charges, expenses, and other important information; read and consider it carefully before investing.

Please Note: Before you invest, consider whether your or the beneficiary’s home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in that state’s qualified tuition program. You also should consult a financial, tax, or other advisor to learn more about how state-based benefits (or any limitations) would apply to your specific circumstances. You also may wish to contact directly your home state’s 529 plan(s), or any other 529 plan, to learn more about those plan’s features, benefits and limitations. Keep in mind that state-based benefits should be one of many appropriately weighted factors to be considered when making an investment decision.

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