State 529 plans are growing in popularity as an effective means of saving for higher education costs and investors are looking to reap some pretty considerable benefits by opting in. With advantages including federal and state tax benefits and some states offering favorable treatment in regards to state financial aid eligibility, 529 plans have a lot to offer.
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South Carolina's 529 plan,
known as FutureScholar, offers many benefits such as a high contribution limit. The plan's website explains that the $370,000 per beneficiary limit and ability to move assets once per year give families the flexibility needed to make saving for the entire cost of higher education a reality.
As with many other similar 529 plans, FutureScholar allows the account owner to retain control of the funds, another valuable aspect of this type of savings plan. Rather than turning the money over to the beneficiary on his eighteenth birthday, the parent or donor decides how the money can be used.
In 2012,
Savingforcollege.com reported that newer versions of the state's plan were introduced featuring lower expenses and minimums than previously offered.
Administered by the state treasurer of South Carolina, the manager for FutureScholar is Columbia Management Investment Advisers. The treasurer's website boasts that Morningstar has awarded their state's plan the bronze award and Savingforcollege.com endowed the program with five caps, which is their highest rating.
The state treasurer also notes that one particular advantage of South Carolina's plan in comparison with many others is that there is no minimum contribution required whatsoever, making it extremely simple to get started. Another variation of South Carolina's plan from many others is that it does not exclude the value of the account where financial aid qualification is concerned, though the plan's website does state that only a small fraction of the account's total value will be considered. This percentage is currently 5.64 percent or less.
http://www.savingforcollege.com/529_plan_details/index.php?page=plan_details&plan_id=68
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The site asserts that 69,000 South Carolinians are currently enrolled in the program with another 33,000 non-residents signed up for the plan.
South Carolina also has a tuition prepayment program, which was created in 1997, but it is currently closed to new enrollment.
The FutureScholar 529 plan is available in a direct-sold program or an advisor-sold program, both of which offer an age-based option, giving investors the choice of conservative, moderate, and aggressive portfolios. The direct-sold option is available only to South Carolina residents.
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