What’s the best way to save for my nephew’s college?

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Q. I want to save for my nephew’s college — he’s five years old — but his parents are not good with money. I want to make sure they can’t access whatever I save. How can I do this?
— Auntie

A. It’s very generous of you to want to help your nephew with future college costs.

It’s also smart to keep the money out of his parents’ hands, especially if you’re not confident in their financial savvy.

You can accomplish your goal by opening a 529 plan with you as the custodian and your nephew as the beneficiary, said Bill Connington of Connington Wealth Management in Fairfield.

“It would allow you to make contributions and then when your nephew went to college, you could make the payments for his tuition directly to them,” he said.

One of the primary benefits of a 529 plan is the large contribution limits, Connington said.

There are other advantages. You can learn more here.

Also see how such 529 plans are considered when it comes to financial aid.

Email your questions to moc.p1591284669leHye1591284669noMJN1591284669@ksA1591284669.

This story was originally published on Jan. 27, 2020.

NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.

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