College savers often wonder whether saving too much can hurt their kids’ chances of receiving financial aid. It’s a complicated topic, and the answer will vary from family to family. In general, saving a significant amount in a 529 plan or a Coverdell education savings account may not impact your child’s financial aid eligibility by very much.
That’s because, within the formula used to determine federal aid eligibility, savings plan assets carry relatively little weight. In fact, family income can weigh more heavily than family assets to determine financial aid eligibility. Figuring out a strategic savings plan for your child’s education means less student loans that they might have to bear in the future.
Don’t hesitate to reach out if you’d like to discuss saving for college. And if you know of anyone who would benefit from reading these short, educational emails, please send along their email address to have them added to the distribution list.
Investors should consider the investment objectives, risks, charges and expenses associated with municipal fund securities before investing. This information is found in the issuer's official statement and should be read carefully before investing. Investors should also consider whether the investor's or beneficiary's home state offers any state tax or other benefits available only from that state's 529 Plan. Any state-based benefit should be one of many appropriately weighted factors in making an investment decision. The investor should consult their financial or tax advisor before investing in any state's 529 Plan.
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