Here are the pros and cons of using a 529 or a Roth IRA to pay for college. A 529 plan, also called a qualified tuition plan, ...

Two popular options are 529 plans and Roth IRAs. Image source: The Motley Fool A 529 plan is specifically designed to save for college costs and graduate school. Annual distributions of up to $ ...

The SECURE 2.0 Act, which became law in December 2022, changes the 529 plan rules to permit rollovers of some funds from these college savings accounts into a Roth IRA. It could allow transfers to ...

Contributions to a Roth IRA can be withdrawn penalty-free to open a 529 plan. 529 plans allow contributions to grow tax-free and provide tax-free distributions for qualified education expenses.

Reason No. 3 to use a 529: Unused funds can be converted to a Roth IRA. One issue with 529s has been if the plan is overfunded and the funds remain unused. For families on a tight budget ...

That's welcome news to families worried about having leftover or unused funds in a 529 plan account. The new Roth IRA rule, included in the SECURE 2.0 Act, will help beneficiaries avoid both taxes ...

Finally, starting in 2024, families can roll unused 529 plan funds to a Roth IRA in the beneficiary’s name without triggering income taxes or penalties.This new rule, signed into law as part of ...

The next best use of an unused 529 plan is to roll it into a Roth IRA. With a lifetime cap of $35,000 and other rules that apply, I view the move as a perfectly reasonable one to make to help give ...

Beginning in 2024, rollovers of unused funds will be allowed from a 529 plan account into a Roth IRA for the designated beneficiary, allowing the account funds to continue to grow tax-deferred if ...

A 529 plan is a tax-advantaged way for parents to ... unlike for other tax-advantaged accounts such as 401(k)s and Roth IRAs, though some limits do exist. States often impose their own lifetime ...