Top 10 reasons to save with Scholars Choice

As one of the largest financial professional-sold 529 plans nationwide, Scholars Choice offers tax benefits, competitive fees and a wide range of investment options. This quick list will give you the key benefits at a glance.

1. Easy and convenient

With the help of your financial professional, a Scholars choice Education Savings Plan account can be easily opened and funded after completing a short application. Once the account is established, you can easily manage it online or by phone and set up recurring contributions from your bank account.

2. Your account can grow faster due to tax advantages

All earnings are free from federal income tax when used for qualified expenses, so you can earn more and grow your account faster when you pay fewer taxes.

3. Use at schools anywhere

Funds can be used at any accredited university, college or vocational school nationwide – and many abroad. Conveniently, any institution with a student aid program run by the U.S. Department of Education qualifies. Bonus: funds can now be used on apprenticeships and towards tuition for K-12 public, private or religious schools. State tax treatment of withdrawals for K-12 tuition expense, apprenticeship program expenses, and the repayment of student loans is determined by the state where you file state income tax. The tax consequences of using 529 plans for elementary or secondary education tuition expenses may include recapture of tax deductions received from the original state as well as penalties.^*

4. Use for more than just tuition

Scholars Choice can be used to pay for tuition, certain room and board costs, as well as fees, books, supplies and other equipment. And now, you can use funds for apprenticeships expenses and towards tuition for K-12 public, private or religious schools. State tax treatment of withdrawals for K-12 tuition expense, apprenticeship program expenses, and the repayment of student loans is determined by the state where you file state income tax. Please see the Plan Description for additional qualified expenses and limitations.

5. Lower impact on financial aid than other savings options

Assets in accounts owned by a dependent student or one of their parents are considered parental assets on the FAFSA. When a school calculates the student's expected family contribution (EFC), a maximum of 5.64% of parental assets are counted. This is quite favorable compared to other student assets, which are counted at 20%. Higher EFC means less financial aid.

Being the account owner or beneficiary of an account may adversely affect the ability to receive financial aid or other benefits under government programs or from a school.

6. Affordable

Open an account with as little as $25 per investment portfolio. If you contribute using payroll direct deposit, you may contribute any dollar amount.

7. Everyone can help with Ugift^®

You don’t have to do it all on your own! Grandparents as well as other family and friends can make gifts to your account for maximum growth potential. Ugift allows others to contribute towards your child’s (or loved one's) education through electronic contributions directly into your Scholars Choice account.

8. Unused funds can be used for other eligible members of your family

If it turns out your child or grandchild doesn’t need all the money or their education goals change, you can change your designated beneficiary penalty-free as long as they’re an eligible member of the family of the former beneficiary.

9. Investment flexibility

Your investment strategy should match your education goals – which includes your time frame and risk tolerance. With that in mind, Scholars Choice offers three specialized investment approaches. They feature professionally managed investment portfolios that utilize a blend of top tier asset managers that are unique to Scholars Choice. Working with your financial professional, you have the flexibility to totally customize your plan. The investment portfolios you’ll learn about may be used separately or together in a complementary mix.

10. Estate tax planning benefits

For federal tax purposes, contributions to your account by you or anyone else are generally considered completed gifts, and may qualify for the annual gift tax exclusion of $18,000 per year for single filers and $36,000 a year for couples. With 529 plans, you can give up to 5 years' worth of gifts at one time — for a maximum of $90,000 for a single filer and $180,000 for couples. See the Plan Description for additional information.