(October 31, 2019) A component of our financial planning service often includes the evaluation of college savings plans, otherwise known as 529 plans, for our clients’ children (or grandchildren). Utah’s 529 plan (my529.org) is the college savings plan we recommend most. Each year, Morningstar reviews the nation’s 529 plans. Once again, Morningstar honored Utah’s my529 as one its Gold-Rated “valedictorians”, largely due to the low costs, breadth of investment options, performance, and ease of use.
Residents of both Kansas and Missouri (and five other states: Arizona, Arkansas, Minnesota, Montana, and Pennsylvania) are a fortunate few when it comes to saving for college – they live in a “tax parity” state. Their contributions to 529 plans receive a state-level tax deduction (up to the maximum allowed), regardless of which state-sponsored 529 plan is used. As advisors, we can search the entire 529 plan universe for the best available option for our clients living in “tax parity” states. For instance, a Kansas resident could contribute to Utah’s 529 plan and receive the state-level tax deduction; a resident of one of the 43 states that does not have “tax parity” must contribute to their home state’s 529 plan to receive the state-level deduction (even if there are better 529 plans available).
Please see this link for Morningstar’s 529 review. If you have questions about your 529 plan or would like to discuss saving for college with one of our Certified Financial Planners (CFP), please call or email anytime.