ATLANTA, Ga. - More people are using 529 savings plans, and if you're not doing it yet then you should consider if it's a right fit for you. This post-tax contribution college savings plan is getting even easier to access.
In Georgia, it's called the Path2College 529 Plan. It's designed to help you help your kids pay for college. You put money into a managed savings plan that allows contributions to earn interest. You're taxed going in, but any interest earned is not taxed by the feds - IF - you use it for qualified education expenses. And as some of you may know the "Tax Cuts and Jobs Act" from 2017 expanded those uses to include not just college costs but K-12 costs, too.
But here is what might be ahead. There are proposals out there for a second round of changes. Potentially down the road your 529 plan money can go for home schooling, apprenticeships and to pay down student loans.
Now you can currently use your 529 savings to pay down student loan debt, but you will face a 10 percent federal tax penalty. Again, new proposed legislation is making its way through congress to help families use any left over money in the account to pay down debt.
Get the lowdown on the state plan right here: Path2College 529 Plan