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You can fund a 529 plan now and convert a sizable chunk of money unused for educational expenses into a Roth IRA down the road. “529 plans will provide the best benefit for college savings ...
An IRA is an individual retirement arrangement that is tax-advantaged and is designed for use during retirement. The funds from a traditional IRA can be cashed out and moved to a 529 account, but ...
There are some situations where it might make more sense to use a Roth IRA for your child’s college fund. Both Roth IRAs and 529 plans are funded with after-tax dollars — you pay tax on your ...
Roth IRA vs. 529 plan. Before using a Roth IRA plan for a college education, you may also want to consider a 529 college savings plan. A 529 plan is a type of investment account specifically ...
Starting in 2024, unused 529 funds can be rolled into a Roth IRA tax-free, thanks to the SECURE 2.0 Act, giving families more flexibility with college savings.
The 529-plan-to-Roth-IRA rules say that you have to have had the 529 account for at least 15 years, and you can only convert funds that have been in the 529 account for at least five years.