 | The 529 plan is a state-sponsored, tax-free college savings plan that allows you to contribute money toward a beneficiary in your family. You retain control over the account, so the beneficiary can't take his/her college nest egg and spend it on something else. The money can be used for any qualified college expense, including housing, food, supplies and tuition. If the money is spent on these qualified college expenses, it’s tax-free! You also choose how much to put aside, whether it be $25 per paycheck or $55,000 up front per beneficiary (utilizing your annual gift tax exclusion for 5 years).
If you withdraw money from the 529 plan and decide not to use it for higher-education expenses, you’ll pay taxes and you’ll be subject to a 10% penalty on the earnings. However, if your designated beneficiary decides not to attend college, you can change your beneficiary to another member of your family, including yourself, and avoid these taxes and penalties (some limitations apply). You may change beneficiaries as often as you’d like.
Each state has a different plan, with varying details and benefits. As a consumer, it is up to you to determine which plan is right for you and your family. You do not have to be a state resident to participate in that state’s particular plan. You may be able to contribute to a plan by payroll direct deposit, direct debit, or by simply writing a monthly check. You may learn more about 529 plans, and compare each state’s plan, by visiting www.savingforcollege.com.
MATRIX has established a relationship with a broker who is sponsoring the Alaska plan through John Hancock Financial Services, Inc. Informational kits are available from the MATRIX Benefits Department. You can learn more about the Alaska plan by visiting www.savingforcollege.com/compare/plan/80.php. If you have any unanswered questions regarding this exciting benefit, please contact our broker, Bruce Roth, at 770-804-5578. You may enroll in the plan by completing the New Account Agreement, the Client Information form, and the 529 Financial Data Gathering form. Once complete, send the originals to the following address:
Bruce Roth
Roth & Associates, Inc.
990 Hammond Drive, Suite 830
Atlanta, GA 30328
Questions about this plan may be directed to the Benefits Department via e-mail.
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