The fees on 529 plans can indeed vary from state to state. As Adam Nash, CEO and co-founder of Daffy, explains, every state has different 529 plans and some of these plans have investments with very high fees, particularly the ones recommended by advisors. These fees can be so high that they eat up all the tax advantage. Some states have specific tax advantages for 529 plans and if you live in one of those states you can actually get a tax deduction for putting money into those accounts. However, for most people, it's recommended to open a plan in the state that has the best plan for you and the lowest cost.
While 529 plans can be an excellent tool to help you reach your financial goal of paying for your child's college education, there are a lot of complications that you need to think about before opening the right one for you. This is where Daffy comes in as a great option for a Donor Advised Fund (DAF).
Daffy is a not-for-profit community built around a new, modern platform for giving. With Daffy, you can easily donate to almost every US public charity, track tax-deductible contributions, and access donation receipts all in one place. Daffy waives all membership fees for members with less than $100 in their fund, making it an accessible and cost-effective choice for those looking to make a difference.
So, while you're considering your options for a 529 plan, why not also consider Daffy as your go-to platform for charitable giving? It's a simple, efficient, and rewarding way to contribute to the causes you care about.
Please note that the information contained on this page is for educational purposes only and should not be considered tax advice. Any calculations are intended to be illustrative and do not reflect all of the potential complexities of individual tax returns. To assess your specific tax situation, please consult with a tax professional.