Education Planning2020-05-28T23:04:26-07:00


Expenses associated with higher education are rising faster than inflation. As a result, it is common for students to take on a massive amount of debt in order to attend the college of their choice.

For many, the burden of monthly student loan payments puts other important goals out of the question. Young adults are waiting to purchase homes and start families while they try to get education debt under control.

If you know tuition bills are somewhere in your future, now is the time to start planning. A smart strategy now may offset the impact of future education expenses. You have a number of choices when it comes to setting money aside for higher education. With the right guidance, you may be successful in reducing the impact taxes can have on those funds as you work towards building your balance to eliminate the need for student loans.

Experienced financial planners will help you explore all of your options to find the college savings account that is right for your situation. These are two popular choices you can consider:

529 Plans

Each state has its own version of the 529 plan, and some are better than others. Fortunately, you can participate in any state’s 529 plan, whether or not you are a resident. These college savings products offer tax advantages to help you grow your balance more quickly. There is no income ceiling to own a 529 plan, and contribution limits are significantly higher than other types of tax-advantaged programs.

At one time, you had to use 529 distributions for expenses related to secondary education. However, today the law permits funds to be used for K-12 tuition, as well. That’s great news for families with children of all ages, because it means more opportunity to save on taxes.

Education Savings Accounts (ESAs)

Also known as Coverdell accounts, ESAs have their own set of tax benefits. The primary differences between these programs and 529 plans are the income and contribution limits. There are other nuances between 529 plans and ESAs that might make them particularly
appealing for some families.

For example, when it comes to K – 12 education expenses, funds from 529s can only be used for tuition. ESA funds, on the other hand, can be applied to just about anything related to enrollment and attendance. That flexibility can make a big difference for some students.

A college education is one of the biggest purchases you will ever make. Make sure you are prepared with a solid education savings strategy that increases your opportunity for success. Please feel free to contact us to schedule your appointment with a Pence Wealth Management education planning professional.

Prior to investing in a 529 Plan investors should consider whether the investor’s or designated beneficiary’s home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state’s qualified tuition program. Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. Please consult with your tax advisor before investing.


Explore our extensive retirement planning services that fit your needs and circumstances.

Image is not available

We offer comprehensive tax planning services to create a custom tax plan that fits your unique circumstances.

Image is not available

Experienced financial planners will help you explore all of your options to find the college savings account that is right for your situation.

Image is not available

We offer comprehensive cash flow analysis services, and we know how to apply the results to create smart solutions.

Image is not available

We take a holistic approach to creating your integrated investment plan by harmonizing strategies that are customized for your needs.

Image is not available

We work with you to find the right balance between reducing expenses and increasing confidence.

Image is not available

Our business succession planning process starts with an honest look at your goals.

previous arrow
next arrow

Request An Appointment

At Pence Wealth, we believe that good financial decisions don’t have to be confusing.

If you have any questions or want to schedule a complimentary meeting to discuss your specific questions, please do not hesitate to contact us.


Providing resources which cover topics from financial planning to investment clarity.


Our events create an opportunity for you to get to know us and our process. If you have some challenges, please join one of our events to get your questions answered. If you’re interested, please subscribe and we’ll keep you updated on our upcoming scheduled events.