Part of what I’m up to is preparing my family for a better future, much like my parents tried to do for me. Many of you may have seen that the recent omnibus bill had some changes for 529 plans. I know, I know, omnibus is a bad word, but really it’s just slamming a bunch of appropriations bills together and passing at the same time. It’d be better to do it separate, but worse with none at all.
Bottom line, in the future, up to $35,000 of unused dollars in the accounts, may be rolled over into a Roth IRA. This is primarily for left over dollars since the account must be open for 15 years. This was one of the reasons I was throttling back how much I contributed. I have GI Bill benefits I’m passing on and didn’t want to over contribute and have subject to taxes.
Bottom line, I recommend as a parent you consider contributing to your child’s 529 plan, for the benefits already there, and this added benefit!