College Savings Plans & Accounts
Give the old college
savings a try
College costs for tuition, fees, and room and board continue to rise. And while grants and scholarships play an important role in funding education, it’s largely left to students and parents to cover all the bills—and the late-night pizza runs.
Families typically use multiple sources to pay for post-secondary education, using funds from savings, current income and loans. If you’re a Michigan resident trying to save up college tuition for yourself or a member of your family, our accounts for college savings can be just what you need to get on the right track to paying off your higher education.
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An Education Savings Account, or ESA, is a tax-advantaged savings account that allows you to start saving for your childrens’ college education by the time they start kindergarten, offering tax-free withdrawals and flexible options for investment and spending.
- Annual contribution limit: $2,000 per child (under age 18)
- Income eligibility limits (based on donor’s adjusted gross income)
- Assets must be used by the time the beneficiary reaches age 30 (with some exceptions)
- Funds may be used for qualified elementary, secondary and post-secondary educational expenses
- Flexible investment options
A 529 college savings plan allows Michigan residents to invest their savings and watch them grow tax-free over time. These savings can only be used for qualified higher education expenses and allow you to choose from a range of investment options that broaden over time.
- Higher contribution limits (set by each state)
- No income eligibility limits
- Typically no age restriction (open to adults and children)
- Funds may be used for qualified higher-education expenses and K-12 tuition
- More limited investment options, which become more conservative as the child ages
Get the help you need from one of our CFS* financial advisors to discuss your college planning goals.
College Savings Calculator
Learn MoreInvestors should consider investment objectives, risks, and charges associated with Section 529 plans prior to investing. Contact your investment representative or carrier for more information about municipal fund securities which is available in the issuer’s official statement or plan disclosure document which should be read carefully prior to investing. Most 529 plans are sponsored and administered by states. State tax benefits vary among the states, and some offer residents additional tax benefits if they invest in their own state plan. Consult your tax adviser for more information.
*Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. Consumers Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members.
