All opinions expressed are the author’s alone, and has not been provided nor approved by any of the companies mentioned. Earnings in a 529 plan are not subject to state or federal taxes, and Connecticut's plan is no different. The main differences between an ESA and a 529 plan are: Income Limit. Simply, for a 529 plan withdrawal to be considered qualified and thus, tax-free, the money must be used to pay qualified study abroad expenses at a college or university that's eligible to participate in federal student aid programs. There are a wide range of investment options so that you can recommend investment strategies that are right for your clients. The value of a 529 college savings plan, whether it is owned by a dependent student or one of their parents, is considered a parental asset on the FAFSA. Opening a 529 plan for a grandchild rather than contributing to a parent-owned plan gives grandparents another stash of money that can be tapped in an emergency. To help families save for college, the State of Connecticut offers the Connecticut Higher Education Trust (CHET), Connecticut’s 529 College Savings Plan. See all direct sold in-state and out-of-state 529 plans available to Connecticut residents and compare plans to find the right college savings plan for you Contribution Limit. Investment Options. 529 plans offer the potential of higher returns and tax-advantaged growth compared with lower-yielding bank accounts.² In fact, if you consider saving $200 per month in a bank account versus investing that same amount in a 529 plan, you could be leaving a lot of money on the table over the course of 18 years. Section 529 plans are not guaranteed by any state or federal agency. Here, I am referring to savings accounts. About CHET. If the COVID-19 pandemic has proven anything, it’s that life is unpredictable. CHET Advisor 529 provides an efficient, flexible, convenient way to save for a college education. We are an independent, advertising-supported comparison service. Advertiser Disclosure. Coverdell ESA vs. 529 Plan Comparison Chart. Alongside the Disclosure Booklet, this is the most comprehensive resource to get a detailed overview of CHET. Total CHET Individual Savings Plan contribution(s): Add Schedule CT-CHET, Lines 1, 2, and 3. 529 plans are tax-deferred investments When you invest in a 529 college savings plan, your withdrawals will most likely be tax free. When determining the EFC, only a maximum of 5.64 percent of a parent’s assets will be used to pay for college expenses. Performance & Prices. You should read and consider them carefully before investing. Series I savings bonds vs. 529 college plan. The Connecticut plans are known as the CHET 529 college savings program and the Advisor Plan (both named from the Connecticut Higher Education Trust). Sure, most 529 college-savings plans took a beating in the bear market, but they are still a great way to save for college. 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