Missouri offers
the MOST 529 Plan that allows individuals to put away money for higher education. Parents, grandparents, relatives, and even friends can contribute to a beneficiary’s future educational coffers.
According to
the Missouri State Treasurer's office, withdrawals made when the beneficiary is ready to attend school are tax-free.
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Missouri has partnered with Vanguard to help parents save money for their children’s educational needs. Missouri residents can invest up to $8,000 per year or $16,000 for married couples that file jointly. The contributions to the plan are not deductible,
according to the IRS, but the earnings through the plan’s investments are not subject to federal tax. They may be subject to state income taxes, but that is not the case for Missouri residents, the treasurer's office said.
People who live outside of Missouri can invest in a MOST 529 Plan. However, it can make more financial sense to invest in a 529 plan from the state where the beneficiary resides.
Like most long-term investment strategies, the results will depend on a number of variables. Just as with other investments, all investment managers will make investors aware that returns are not guaranteed. Two of the most important variables are the length of time that the plan is active and the amount invested. Missouri MOST’s website said the length of time for most plans is typically between five and 20 years.
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In addition to the contributions made by investors, the MOST 529 plan also works with Upromise, an organization run by Sallie Mae to help increase contributions via a matching program with many top U.S. companies.
The Upromise website reported that Best Buy, Walmart, Staples, and the Apple Store are among the many companies that will help contribute to a Missouri MOST plan when customers shop at a participating store.
Many parents may consider 529 plans as primarily for students who plan to attend college. That is not the case, the state treasurer’s office said. The funds can be used for college, trade school, or technical school.
While the plan is usually described as requiring a minimum investment of $25 per transaction, the amount can be as low as $15 per transaction if the contributor takes advantage of automatic payroll deductions, the
website for all 529 plans in the U.S. said.
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