New 529 Plan Rules

The Tax Cuts and Jobs Act made some changes to 529 savings plans, which I discussed in Retirement Watch. This article says many parents still aren’t making use of the provision and explores the reasons why.

They may be concerned their funds in a 529 plan could reduce their child’s chances of being awarded a scholarship for their precollege education, he said.

“If you have resources available to pay for private K-12, then maybe that’s going to be considered when you apply for financial aid,” Kantrowitz said.

“It’s a well-founded concern,” he added. “Some schools have said that they’re going to start considering 529 plans when asking parents about their assets.”