How “superfunding” a 529 account works

529 savers can now roll funds into a Roth IRA

One of the key disadvantages of a 529 college savings plan is the possibility a beneficiary doesn’t end up going to college. Nonqualified withdrawals are subject to a 10% penalty. However, as of 2024, the SECURE Act 2.0 started allowing 529 savers to roll over $35K into a Roth IRA.

529 plan advantages include state-specific tax exemptions and more

For National 529 Day, celebrated on May 29, an expert explained the basics of 529 accounts. Outside of forced education savings, advantages include flexibility around beneficiaries (they can be changed easily), how unused funds can be rolled into a Roth IRA, and state-specific tax exemptions.

Explore a guide to 529 college savings plans

Investors put after-tax dollars into these education-earmarked accounts, and like a 401(k) or IRA, they invest them into stocks, bonds, or funds. When it comes time to withdraw, investors do not pay any taxes on distributions. However, the money must be used for approved expenses like college tuition, textbooks, and trade schools.

The scope of 529 plans has expanded, but 529s still have some drawbacks

The tax-advantaged accounts can be used to pay for K-12 education, apprenticeship programs, and student loans, in addition to their original purpose: paying for college. But 529s have downsides, such as fees and penalties for non-qualified uses.

The IRS answers basic questions about 529 savings plans

The plans can be used to pay for any qualifying education expenses from kindergarten to college, including tuition, fees, room and board, and even computers. Anyone can set up as many 529 plans as they want for relatives, friends, or themselves.

529 plans have some withdrawal penalties

The IRS imposes a 10% penalty on non-qualified withdrawals from 529 college savings plans, which hold funds for education-related expenses. However, there are exceptions to the rule, including if the beneficiary dies or becomes disabled. There's also an exception for beneficiaries that receive tax-free scholarships or attend military academies.

Contributing to a friend’s child’s 529 Account

A podcast listener asks about contributing to a 529 savings plan for their friend’s child. The hosts go over the basics of what a 529 is and how it works, and then give advice on how the listener can contribute, touching on how to have conversations about money with friends.

529 plans can affect college financial aid

Income affects FAFSA financial aid determinations. FAFSA also takes 529 college savings plans into account. The percentage of savings it uses in its calculations depends on who owns the account (parent, student, or someone else). Other schools use a program called CSS to determine financial aid, and those determinations vary.

Many states offer a tax deduction for investing in their 529 plans

Different states offer different types of 529 plans (prepaid and savings), and they can require different minimum contributions. While some states offer tax deductions for residents who invest in their state’s plan, investors can choose to use a different state’s plan instead.

A 401(k) 'super catch-up' lets people between 60 and 63 add money to their 401(k)

Through a "super catch-up," they can boost their retirement contributions as they prepare to stop working. But super catch-ups aren't always right for everyone.

Gifting money is one way to avoid death taxes

Gifting money while you're alive is one way people avoid estate and inheritance taxes. There is a yearly cap on how much you can give to a person before that money is taxed—but there isn't a cap on how many people you can give money to in a year.

The IRS sets new contribution limits for IRAs and 401(k) plans each year

In 2024, individuals could contribute up to $7K across all their IRAs. People aged 50 and older could contribute up to $8K. For 2025, the IRS kept the same contribution limits.

Watch a breakdown of tax breaks most Americans don't know about

Programs like healthcare savings accounts or flexible spending accounts are tax-free accounts that are designed to help lower healthcare costs. However, many Americans don't use them and don't understand how they work.

Bizarre college donations and the strings attached

When donors give to a college, they regularly prescribe specific stipulations, typically to fund a professorship in their name in a certain subject. But some of those stipulations are unique, including requiring annual graveside flowers, pet adoption for 150 dogs, or the consistent teaching of Ayn Rand’s "Atlas Shrugged."

In 1931-32, JP Morgan Jr. paid no income taxes due to his company’s losses

This legally reduced his taxable income under existing laws. Similarly, the Rockefellers leveraged charitable foundations to minimize taxes, allowing them to preserve wealth while directing funds to their preferred causes.

Special needs trusts help financially care for dependents with disabilities

Special needs trusts are a specific type of trust that ensures dependents with special needs still qualify for Supplemental Security Income and Medicaid, given the trust's assets are excluded from the asset limits tests required to qualify for these programs.

Calculate how much of your tax dollars go to each federal program based on your income, filing status, and number of children

The highest 2024 federal income tax bracket covered income upward of $731,201 for married couples filing jointly

To understand what you would owe on short-term capital gains and to visualize the favorability of long-term tax rates, you need to know how your traditional income is taxed at the federal level. A breakdown explores the different brackets for 2024, separated by filing status.

What are baby bonds?

In 2008, Hillary Clinton proposed giving every US newborn a $5,000 government-funded trust, often called a “baby bond,” to help low-income families build long-term wealth. Supporters said it could reduce wealth inequality, while critics argued existing programs like the Child Tax Credit offered similar benefits.

Read about the situations where a high-yield savings account doesn't make sense

While financial experts often recommend high-yield savings accounts, one expert argues that prioritizing adding more money to one doesn't make sense for someone who has a lot of high-interest debt or isn't taking advantage of their company's 401(k) match.

Financial rules that many FIRE followers live by include guidelines around tax efficiency and more

Many FIRE proponents follow specific financial rules, like the 4% rule, in order to achieve FIRE. They also take steps to create an efficient tax strategy and take advantage of compound interest.

HSA spending spikes early in the year, while FSA spending peaks in December

Because health savings accounts are designed to alleviate high upfront costs for people with high deductible health plans, the majority of HSA spending happens early in the year. However, around 10% of flexible spending account funds are used in December—right before the use it or lose it deadline.

Citizens United v. Federal Election Commission allowed unlimited independent spending in US elections

The 2010 Supreme Court ruling allowed corporations and other outside groups to spend unlimited money on elections independently of candidates—while leaving direct contribution limits intact—expanding the role of wealthy donors and outside influence in American political campaigns.

Buffett is known for being extremely generous with his fortune

So generous that in 2010 he pledged to donate 99% of his money. He said this money “can have a huge effect on the health and welfare of others.” This letter is Buffett’s philanthropic pledge, which details his commitment to giving and how luck and privilege helped him accumulate so much money.

More than $100M in scholarships goes unclaimed each year

More than $50B in scholarships are awarded each year, though analysts estimate more than $100M goes unclaimed due to a lack of qualified applicants. That fact should be unsurprising given the dizzying number and criteria for thousands of applications. This portal from the US Department of Labor lets you quickly search more than 9,600 scholarship opportunities by program, eligibility criteria, and more.

The 16th Amendment paved the way for capital gains taxes

Ratified in 1913, the 16th Amendment paved the way for a far-reaching federal income tax and supercharged the country’s coffers. Before then, the US depended on import tariffs and so-called consumption taxes to raise revenue.

While the first exchange-traded fund (a 'basket' of different assets that can be bought and sold on a stock exchange) in the US only launched in 1993, the global ETF market has grown to more than $10T in the short time since.

Hedge funds, the private investment firms that trade a wide swath of financial assets, make money by imposing steep fees on investors and from the fund's investment performance.

The price of gas is a composite made up of several different factors, with the federal gas tax making up less than 20% of what drivers pay at the pump.

Up to a million Girl Scouts sell about 200 million cookie boxes every spring, generating $800 million, largely because refusing a child is frowned upon

Despite being favored by 87% of Americans, Congress does not have term limits.

US consumers collectively owe more than $1T to credit card companies—almost as much as they owe in auto loans.

Play the role of a student in a game where you try to navigate college and remain debt-free, selecting different income levels, high school experience, race, ethnicity, and more.

See this overview of the firework rules across all 50 states, ranging from a complete ban on non-professional fireworks in Massachusetts to states with more lax rules like Indiana.

Venture capital is a form of funding provided to early-stage companies with high growth potential, typically in exchange for an equity (or ownership) stake

Dozens of S&P 500 stocks, including Coca-Cola and Walmart—known as the dividend aristocrats—have increased dividends every year for 25 years

US housing costs have risen by roughly 175% between 1991 and 2026—but a growing number of Gen Zers are becoming homeowners anyway. In 2025, 4% of homebuyers were Gen Z, up from 3% the year before.

The idea for the Federal Reserve was conceived in secret in 1910—with bankers donning duck hunt gear for disguise while traveling to a remote country club on Georgia's Jekyll Island

Explore fun facts from the USPS, including unique post office buildings, a stamp that traveled past Pluto, and more.

Gerrymandering works through two techniques: cracking opposing voters across districts to dilute their power, and packing them into a few to waste their votes in lopsided majorities.

How fusion—which releases energy when two lighter atoms combine to form a heavier atom—differs from fission

Double world record holder Hunter Ewen helped conquer his fear of balloons, called globophobia, by training to win Guinness World Record titles for balloon inflation.

The use of fungi to detoxify land and water—a process known as mycoremediation—has been used to clean up natural resources affected by the 2025 California wildfires.

A 2019 Facebook event called on attendees to "Storm Area 51, They Can't Stop All of Us," resulting in countless memes, the creation of a music festival, and eventually the arrests of those who did try to approach the area.

Visualize how CRISPR-Cas9—a type of immune system used by single-celled organisms to attack invasive viruses—targets and makes precise changes to a gene's DNA.

In 1939, baseball star Lou Gehrig delivered his inspirational 'Luckiest Man' speech after retiring due to the health condition that now bears his name.

Art theft is the third-largest source of criminal revenues worldwide, thanks in part to the subjective nature of valuing a work of art.

Brandi Chastain, the star of the 1999 US victory over China in the 1999 Women's World Cup, was a last-second choice to take the penalty kick that sealed the victory.

The 2026 Ebola outbreak is hampered by a lack of vaccine against the species of the virus, heightening the need for rapid tests to aid in disease control.

Coral polyps reproduce via broadcast spawning, where entire reefs simultaneously release reproductive cells for about one hour, once a year.