Created by section 529 of the Internal Revenue code in 1996, a 529 savings plan is a qualified tuition program designed specifically to save for college. Tax-deferred growth on earnings and federal income tax-free distributions1 set 529 savings plans apart from other investment vehicles used to save for college.
Saving for college is challenging, and with so many options, finding the right savings vehicle is crucial for your loved one.
In addition to 529 plans, college savings alternatives include Coverdell education savings accounts, UGMA/UTMA accounts, Series EE and Series I Savings Bonds, and taxable investment accounts.
While each of these savings strategies has its own distinctive features, there are benefits offered by 529 plans that exceed these alternatives.
1State tax laws and treatment may vary. Earnings on non-qualified distributions will be subject to income tax and a 10% federal penalty tax. Please consult your tax adviser for more information.
If your state or your designated Beneficiary's state offers a 529 plan you may want to consider what, if any, potential state income tax or other benefits it offers, before investing. State tax or other benefits should be one of many factors to be considered prior to making an investment decision. Please consult with your financial, tax or other adviser about how these state benefits, if any, may apply to your specific circumstances. You may also contact your state 529 plan or any other 529 college savings plan to learn more about their features. Please contact your financial consultant or call 1-866-222-7498 to obtain a Plan Disclosure Document or prospectus for any of the underlying funds. The Plan Disclosure Document contains complete details on investment objectives, risks, fees, charges and expenses, as well as more information about municipal fund securities and the underlying investment companies that should be considered before investing. Please read the Plan Disclosure Document carefully prior to investing.
John Hancock Freedom 529 is a college savings plan offered by the Education Trust of Alaska, managed by T. Rowe Price, and distributed by John Hancock Distributors LLC through other broker/dealers that have a selling agreement with John Hancock Distributors LLC. John Hancock Distributors LLC is a member of FINRA, and is listed with the Municipal Securities Rulemaking Board (MSRB). © 2010. John Hancock. All rights reserved.
529 plans are not FDIC insured, may lose value and are not bank or state guaranteed.