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Facts About Florida's 529 Plans

By    |   Wednesday, 20 May 2015 12:04 PM

Florida has two savings options for families who wish to send their kids to college through its 529 college savings plan; the Florida Prepaid College Plan and Florida 529 Savings Plan. 
The Florida Prepaid College Plan is the largest in the country, according to Savingforcollege.com.


All 50 states sponsor 529 tax-advantaged savings plans in some form. These plans are authorized by the IRS to encourage people to save for future college costs. What the plans offer differ from one state to another. Here are some facts on both of Florida's 529 plans to consider before choosing one.


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  1. The Florida Prepaid College Plan allows you to choose specific costs, payment schedules, and the benefits that fit your needs. Unlike other state 529 plans that allow anyone to open an account or for the money to be applied to any qualifying higher education facility nationwide, the Florida plans require state residence to initiate one, and the plan is designed to be spent at a Florida college or university.

  2. The amount covered by the plan can, however, be applied to other schools nationwide. You can have accounts in the two different plans. The largest difference between the two plans is that the Florida 529 Savings Plan is subject to fluctuations in financial markets. The Florida Prepaid College Plan is guaranteed by the state.
  3. The Florida Prepaid College Plan also pre-pays tuition and fees at a Florida college or university at current plan prices, allows enrollment during the fall and winter period only, allows enrollment until 11th grade, and requires the parent and child to be legal residents of Florida for the past 12 months to enroll.


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  5. In addition, money saved from the Florida Prepaid College Plan covers most fees associated with education except room and board (a dormitory plan also is available separately), and the plan can be used nationwide, but it is designed to be used in Florida. Earnings are tax-free when used to pay for qualified higher education expenses.


  6. There are three payment options: monthly, five-year and lump sum and the plan is guaranteed by the state, and money can be refunded if the child never attends college.


  7. The Florida 529 Savings Plan is slightly different from the Prepaid College Plan, in that the money goes to a college savings account through a variety of investment options, it has open enrollment year round, students of any age or grade can enroll, and the plan owner does not have to be a Florida resident.


  8. The Florida 529 Savings Plan covers fees, books, housing at schools nationwide and can be used for room and board as long as they are qualified higher education expenses. There is an initial contribution of $250 or $25 monthly automatic contributions, and there is risk based on investment options chosen.

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Florida has two savings options for families who wish to send their kids to college through its 529 college savings plan; the Florida Prepaid College Plan and Florida 529 Savings Plan.
529 plans, Florida, facts
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2015-04-20
Wednesday, 20 May 2015 12:04 PM
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