George Mentz – Author – Speaker – Global Education Pioneer

Founder of the 1st Educational Body in the USA to Earn ESQ & TUV Accreditation and ISO 21001 & ISO 29990 Certification for Educational Standards – Promoting ACBSP and AACSB Accredited Education and Exams Worlwide to Enable Graduates of Top Business Schools to Seek Professional Certifications.

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George Mentz – Author – Speaker – Global Education  Pioneer

The 529 Plan Butterfly Effect – The 529 Effect on Markets and Indexes by George Mentz – Economics in the 21st Century

People are socking away millions for college savings.  529 plans are popular because they allow you to fund them using annual gift exclusions to your child or loved ones.

Each year you can pump in the max gift of 14,000 cash. Or you could have socked away a 5 year amount all at once.  example:  $70,000 in one lump sum per done.

Have you ever wondered how much money is being put into 529 Education plans.  Let me see, it has been since the late 1990s that these plans were taken seriously and set up by each state.

What happens to the money when it goes into a 529?  In most cases, you are allowed to select an investment plan with the administrator of the funds which may be: aggressive, balanced, or fixed.  i.e. Most invested in securities that are on the NASDAQ, NYSE or AMEX.

What’s the benefit?  Tax free grow and removal to fund college and education costs.  And, you need not file taxes the income or gains as it grows over the years?

It has now been about 16-18 years since these things became popular to college savers, to our nations hardest working and wealthy.

Guess what?  Last August and This Dec/January were huge dips in the stock market in 2015-16.   My theory is that there is enough money coming our of 529s now that it is pulling liquidity and demand from the market and reducing stock and index prices.

Voila, the new 529 Effect on US stock markets.

References

https://www.irs.gov/uac/529-Plans:-Questions-and-Answers

 

This entry was posted in Uncategorized and tagged 529 plan, Application programming interface, Arne Duncan, Associated Press, Bureau of Indian Affairs, College football, George Mentz, george mentz author, george mentz colorado springs, george mentz economist, george mentz futurist, george mentz professor, Higher Education, Individual retirement account, mentz 529, Savings account, the 529 Effect, United States on April 12, 2016 by admin.

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