Because of the SECURE Act, the 529 plan has received a functionality boost in 2020 and beyond.
A 529 plan can now be used for:
- All college tuition and qualified expenses
- $10,000 a year for K-12 tuition and qualified expenses
- Apprenticeship programs and qualified expenses
- $10,000 to pay down a qualified education loan repayment for each of a 529 plan beneficiary’s siblings
Given these benefits, if you have kids, contributing to a 529 plan makes even more sense. Always maximize the purpose of your money by taking advantage of any benefits the government throws our way. Goodness knows they tax us hard-working citizens enough!
After a strong 2019, I decided to take a look at my son’s 529 plan. Although it underperformed the S&P 500, it still reached a level that made me question whether it’s possible to contribute too much.
Perhaps you’re wondering the same thing.