Nevada Residents Encouraged to Utilize 529 Plans for Education Savings

Although September was College Savings Month, Nevada residents are encouraged to save for their children’s education now.

Jordan Lee, CEO of Backer, emphasizes the benefits of 529 plans, a tax-advantaged investment tool that has been helping families save for education expenses for 25 years.

“A 529 plan is a very powerful investment vehicle,” said Lee, noting that Congress has expanded the range of qualified expenses savings can cover.

While 529 plans traditionally focused on college and graduate school expenses, they offer more flexibility.

“You can pay for a computer, and now it covers K-12 private school tuition, if that’s a priority. Recently, apprenticeship programs were added as a qualified expense, which is great for adults considering retraining or a career transition,” Lee explained.

One significant advantage for Nevada residents is the absence of capital gains tax on the growth of a 529 plan. Lee also pointed out the state’s unique program, the Silver State Matching Grant, which offers Nevada residents an additional financial incentive.

“With the Silver State Matching Grant, you can get up to $300 per year for five years, for a maximum of $1,500 per beneficiary, if you set up a 529 plan with a future path,” Lee added.

A new feature introduced this year allows unused 529 funds to be converted into a Roth IRA, making it a flexible tool even if the beneficiary doesn’t pursue higher education.

“If you end up with leftover 529 assets, you can kickstart a Roth IRA for your child, offering them a meaningful head start on retirement savings,” said Lee.

He also highlighted that 529 plans will continue evolving to support various educational and non-traditional paths.

In addition to the Silver State Matching Grant, Nevada residents can explore other savings programs, like the Nevada Putnam Scholarship and the USAA Program, further expanding their options for securing their children’s future.