529 plan
Simple answer. Do I put the 529 plan I set up for my grandkids in my name or my daughter’s name. For financial aid purposes
Terry Says
Interesting answer. If you put the account in your own daughter’s name, it will have little impact on qualifications for financial aid. If you put the account in YOUR name, it will have no impact on financial aid — EXCEPT the year after they withdraw the money. In that next year, the withdrawal will be considered as a student asset, and will have a large impact on that next year’s financial aid!
So if you plan to save enough to cover more than one year (the last year) of school, I suggest using the child’s parent as custodian. The one thing you lose out on with that is the ability to withdraw your gifts if you need the money. If you do withdraw for your own purposes from an account titled with your name, you’ll pay income taxes on the gains and a 10 percent penalty, though.
