Did You Know A 529 Gift Can Help With Estate Planning?

Planning for your family’s future isn’t just about immediate savings and investments. It’s also about taking steps to protect your estate, and a 529 plan can play a role in that. Many people are aware that 529 plans help cover educational expenses, but did you know they can also be part of a smart estate planning strategy?

 According to *Fidelity Investments*, "Gifts to 529 accounts can also help with estate planning. Gifters can contribute up to $17,000 in 2023 ($18,000 in 2024) to a 529 account per person, per year with no gift tax ramifications. So a married couple could gift up to $34,000 per account, per year in 2023 ($36,000 in 2024) without having to pay a gift tax or erode their lifetime gift tax exclusion. Once the annual gift has been made to the 529 plan, the money is no longer considered part of the gifter's estate, for estate tax purposes."

 This means you can reduce the taxable value of your estate while simultaneously supporting a loved one’s future education. It’s a win-win for families looking to safeguard their financial legacies while helping the next generation avoid student loan debt.

 However, it's essential to note that estate planning is complex, and everyone's financial situation is different. The author of this blog is not a tax professional. You should always consult with a trusted tax or financial professional before making any financial decisions to ensure you're making the best choice for your estate and financial goals.

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We are small business owners and not financial advisors. This information was provided free of charge with the intent of helping you based on our personal experience and research at the time of publishing. Please do your due diligence and research this information and more for yourself and consult a professional financial advisor before making any that could have major impacts on your financial well-being.