A Coverdell Education Savings Account allows the parent to retain full control of college savings. This type of account allows parents to set aside money in tax-deferred investments. In a Coverdell Account, you will not owe taxes on gains or income until the money is withdrawn and if the funds are used for educational expenses you usually will not owe any taxes.

The money accumulated in a Coverdell Account can be used for a broader range of expenses relative to a 529 plan, including educational costs relate to elementary and high school in addition to college expense. In this type of account, the maximum yearly contributions for the beneficiary cannot be more than $2,000, subject to certain income limitations.

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Disclosures

The information provided represents the opinions of Monetta Financial Services and is for informational purposes only. It should not be construed as a recommendation to buy or sell any security, nor as investment advise.