coverdell education savings account

The Coverdell Educations Savings Account is an account/trust that is used to establish educational savings for a person. With a Coverdell, the savings and profits are eligible for use in elementary, secondary, and university education. Each year, the parent or other benefactor places a maximum of $2,000 into Coverdell savings for the child, for a possible maximum of $36,000 in principal if begun at birth and continued until the 18th birthday. In addition, each Coverdell has a annual return rate that adds interest to the principal throughout the years. The main advantage that comes with a Coverdell account is in the form of tax - Coverdells are tax advantaged, in that taxes will not be paid on the amount place into the trust, nor on the income it amasses throughout the years as long as it is used for qualified educational purposes.

Fast Facts

right now, some benefits of the coverdell ESA are set to expire in 2009
an account similar to an ESA is the 529
the Coverdell ESA "evolved" from the Education IRA

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Coverdell Education Savings

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Series Savings Bond Types: Advantages and Disadvantages

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EE Series Bond College Savings

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529 College Plan Savings

Are you concerned about your ability to pay for your kids’ college education? Maybe it’s time to take a look a...
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Custodial College Savings Accounts

In many ways, custodial savings accounts are similar trust accounts. In both, a person who is not the benefici...
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