529 Account Question

vballmom
Thu, 04 Apr 2013 18:27:18 +0000

There’s no real relationship between excess funds due to scholarships covering more than the COA and your 529. Just think of a 529 being a place to store money that you intend to use for college. The money grows tax-free, and has a favorable assessment when reported on FAFSA as compared to other student savings. If you have extra money and want to invest it, you can open a 529 and add the money. It doesn’t matter where the money came from originally.

Edit to add that money in a 529 is reported on FAFSA the following year. So if you open a 529 this year, it won’t have any effect on your current award.