Start Investing for Future Education Expenses Today!
Opening an account with Westcore is easy. Visit the Open an Account section of our website for step-by-step guidance. Keep in mind that participation in Westcore’s Automatic Investment Plan allows you to open an account with a $1,000 investment and as little as $25 per month.
We understand that you want to help your child or grandchild take advantage of the best educational opportunities available. To a large extent, this means helping to prepare for the financial costs of higher education. By having a financial plan in place, you can give a child more options as to where and when he/she will go to college, a better chance to take advantage of all a school has to offer and an opportunity to minimize how much he or she owes upon graduation.
You have several different account options when investing for future education expenses, including Coverdell Education Savings account, UGMAs, UTMAs and individual investment accounts. Deciding which account type is best for your situation is an important step in creating an effective financial plan for managing future education expenses. To help you better understand your account options, information about each can be found below. In addition, you may want to consult your investment advisor.
CESA Accounts were specifically created to help individuals and families save for future education expenses. Benefits include:
- Tax-sheltered earnings and interest on contributions up to the $2,000 per year limit
- Tax-free withdrawals for qualified primary, secondary and higher education costs
More detailed information regarding CESA Accounts is available in our Coverdell Education Savings Account Information Booklet.
Uniform Gift to Minors Act Accounts (“UGMAs”) and Uniform Transfer to Minors Act Accounts (“UTMAs”) allow you to contribute to a custodial account in a minor’s name without having to establish a trust or name a legal guardian. Benefits include:
- Ability for any adult to invest on behalf of a minor
- No limit on the amount that can be invested
- Tax-free for the first $700 in earnings and generally taxed at the minor’s rate on earnings thereafter
- Flexibility to use the account funds however you choose – not limited to educational expenses
An individual investment account in your name, while not specifically designed for educational expenses, is an option to consider. Benefits include:
- Complete control over your investments
- Freedom to use the investment as you wish, with no penalties
- Potentially more favorable in terms of a child’s eligibility for financial aid
