Robert Brokamp

I'm not going to cover it here, but definitely do that research if you're interested.

What are the pros of a 529 account?

Tax-free growth as long as the withdrawals are used for qualifying, education expenses, room, board, books, all kinds of things.

Favorable financial aid treatment, the 529, is owned by the adult who opens it, so if it's a parent, that will have a lower impact on financial aid eligibility.

If it's owned by some other adult, like a grandparent, it may not be reported at all for financial aid, but again, that varies on the school, and that's not the case for the CSS profile, so pay attention to the requirements of the schools you're interested in.

High contribution limits.

There's no annual contribution limit to 529s.

There are lifetime contribution limits, but the limits range from $240,000 to $500,000.

And if you have any reason to exceed that limit, you could just choose another state's 529, because you do not have to use your own state's 529.

You do have retained control of these accounts, right?

The person who opened the account, the adult, parent, grandparent, or other adult, they maintain control and can change the beneficiaries at any time if needed.

You might get a state income tax deduction.

More than 30 states allow taxpayers to deduct contributions to 529s on the state income tax return, but subject to varying rules and limits, so definitely see what is possible in your state.

And what if your kid doesn't want to go to college?

Well, there are options for excess.

So it can be transferred to another qualifying relative, siblings, cousins, even yourself if you want to go back to school.

Also, any unused money can be transferred to a Roth IRA for the beneficiary.

There are a lot of rules and limits that apply to this, one being that the 529 has to have been open for at least 15 years, but there are many more, so do your research before you try to do that.

But you do have options.

That's the good news.