Expert suggests three plans to help save for college

Jun 7, 2013, 5:00 AM | Updated: 5:00 am

PHOENIX — Your child may be young now, but someday they’ll be heading off to college. You probably need to start saving money now to pay for it.

Mike Sullivan of the Take Charge America Consumer Credit Counseling service is suggesting three plans that might help you save.

One is called the 529 plan, which allows you to save up tax free earnings for high learning.

“It can be mutual funds or CDs, whatever your state happens to offer,” Sullivan said. “You can contribute every year. In most states, including Arizona, you get some kind of a tax benefit for your donations.”

Sullivan said another savings plan is called Coverdell. It used to be called an education IRA.

“There’s a smaller limit as to how much you can put into a Coverdell,” Sullivan said. “But there’s also a little more flexibility even than a 529 plan. If you’re only saving small amounts, say a couple of thousand dollars a year, I personally think it’s just as good as a 529, maybe even a little bit better.”

The third savings plan is the Roth IRA.

“It’s not really a college savings vehicle, it’s a retirement savings vehicle,” Sullivan said. “But you can withdraw your contribution for higher education purposes without a penalty.”

When asked which plan he would personally choose, Sullivan said the 529 plan is the best for people who can sock money away for their kids’ college.

We want to hear from you.

Have a story idea or tip? Pass it along to the KTAR News team here.

Arizona News

(Photo Courtesy of Taylor Dintzner)...
Danny Shapiro

ASU fraternity raises more than $60K for TGen, shaves heads in honor of former member

An ASU fraternity has raised over $60,000 for a former member who used to work for TGen in Phoenix before his 2020 death.
5 hours ago
(File photo by Mark Wilson/Getty Images)...
KTAR.com

Arizona Thanksgiving holiday DUI arrests down slightly from last year, up from 2019

DUI arrests over the Thanksgiving holiday this year fell slightly from 2020 but was higher than 2019, the Arizona Governor’s Office of Highway Safety said Monday.
5 hours ago
(Facebook photo/City of Phoenix, AZ USA)...
Torrence Dunham

Maricopa County ranked No. 1 in talent attraction for second consecutive year

The annual Talent Attraction Scoreboard by labor market analyst EMSI has Arizona being No. 1 in talent attraction for the second consecutive year and fourth time in the last six years.
5 hours ago
(Pexels photo)...
KTAR.com

Home warranty company agrees to $150K settlement in Arizona over fake reviews

More than 1,300 Arizonans who purchased home warranty services from a company accused of misleading consumers will get restitution as part of a consent judgment, Attorney General Mark Brnovich’s Office announced Monday.
5 hours ago
(File photo by Win McNamee/Getty Images)...
Kimberly Silverio-Bautista I Cronkite News

Arizona’s ‘QAnon Shaman’ gets new lawyer, sets up likely appeal of Jan. 6 guilty plea

Jacob Chansley, the Arizona man who pleaded guilty to his role in the Jan. 6 assault on the Capitol, switched attorneys Monday, laying the groundwork for a possible appeal of his plea and 41-month sentence.
5 hours ago
Maricopa County flag...
Kevin Stone

7 finalists revealed for vacated Maricopa County Board of Supervisors seat

Seven finalists have been selected for the interview stage in the process to replace Steve Chucri on the Maricopa County Board of Supervisors.
1 day ago

Sponsored Articles

...
Day & Night Air Conditioning, Heating and Plumbing

Why fall maintenance is important for your heating system and A/C

It’s easy to ignore your heater and air conditioner when they’re working but the moment something breaks, you will likely regret not keeping up with maintenance. After all, if something goes wrong, you may be stuck with a repair that will take longer and be more expensive than simple maintenance.
...
Schwartz Laser Eye Center

How to sharpen your vision with elective procedures

Imagine opening your eyes in the morning and being able to see clearly. You wouldn’t have to wait to put on glasses or contacts, and there would be no more blurry showers nor forgetting where your glasses are.
...
PNC Bank

3 cool tips to turn everyday moments into learning experiences for your child

Early brain development has a crucial impact on a child’s ability to learn and succeed in school and life. Research has shown that 90% of a child’s brain is developed by age five.
Expert suggests three plans to help save for college