States sponsor 529 plans — qualified tuition programs authorized under section 529 of the Internal Revenue Code — that allow taxpayers to either prepay or contribute to an account for paying a student's qualified higher education expenses. Similarly, colleges and groups of colleges sponsor 529 plans that allow them to prepay a student's qualified education expenses. These 529 plans have, in recent years, become a popular way for parents and other family members to save for a child’s college education. Though contributions to 529 plans are not deductible, there is also no income limit for contributors.
529 plan distributions are tax-free as long as they are used to pay qualified higher education expenses for a designated beneficiary. Qualified expenses include tuition, required fees, books and supplies. For someone who is at least a half-time student, room and board also qualify.
The Education Plan (New Mexico's Direct Sold College Savings Plan)
The Education Plan® can be used to save for college costs not covered by scholarships, grants or other forms of financial aid.
The Education Plan, New Mexico's 529 college savings plan, offers a flexible and tax-advantaged way to save for a child's college tuition.Benefits such as tax free savings, investment management expertise and low fees, allow you to better prepare for tomorrow's college costs—today. The Education Plan (Direct Sold Plan)
Created under Section 529 of the Internal Revenue Code, 529 College Savings Programs provide compelling savings advantages, such as tax-deferred accumulation, federal tax-free earnings for qualified withdrawals, reductions in estate taxes, and special gift tax treatment. Additionally, 529 College Savings Programs offer personal control and flexibility over assets and beneficiaries.
Saving for college is the biggest challenge parents and students can face. 529 College Savings Programs are a flexible, convenient and tax efficient method to save for college costs including tuition, fees, room, books and supplies. Funds can be used to pay for education at colleges and universities across the nation and at certain schools abroad. New Mexico residents can deduct contributions to New Mexico's 529 College Savings Program dollar for dollar off of their state taxable income. New Mexico is one of only four states to offer an unlimited deduction to its residents.
Scholar's Edge (New Mexico's Advisor-Sold Plan)
With Scholar’s Edge, New Mexico’s 529 College Savings Plan,
You Can Get an Edge When You Save for College
For the vast majority of families, paying for a child’s college education is rarely an all or nothing proposition. Because only a select few students receive full scholarships, most families typically take a three-pronged approach:
- Student Loans
- Financial Aid
By incorporating a tax-advantaged 529 plan such as Scholar’s Edge into your families overall financial plan, you can take a smart pragmatic approach toward this important goal. Money you invest in a 529 college savings plan has the opportunity to grow tax-free and may also benefit from compounded growth. In other words, you earnings may generate additional earnings and help your account grow faster.
Contact Your Financial Advisor To Enroll Today