Saving to fund education can be challenging, yet very rewarding. Designing an education savings plan to help accumulate the right amount of assets at the right time is critical. Following the plan in a disciplined way, while adjusting it periodically to account for the rising cost of a college education, is also important.
Help your student by choosing among a handful of investment programs, some of which offer tax advantages while saving for education expenses.
A 529 College Savings Plan is a tax-advantaged investment account selected by owner with state-provided choices available. Some states also offer tax-deductible contributions for residents2. The benefit to you is that your contribution will grow on a tax-deferred basis, and your distribution to pay for college can also be made tax-free.
Investors should be mindful that 529 College Savings Plans are municipal securities and may be subject to market volatility and fluctuation. 529 College Savings Plans are sold by prospectus, which contain important information. Read it carefully before investing.
Another great benefit is that you, as the account owner, will have control over the funds. Many plans may even allow you to reclaim the funds for yourself if your needs change.
A Coverdell Education Savings Account is a tax-advantaged investment account in which parents can choose to invest in stocks, bonds, mutual funds, and more. Funds can be used for qualifying elementary, secondary and college expenses.
A Custodial Account is an irrevocable gift to a minor, managed by an adult custodian. These funds go beyond education and can be used for any purpose benefiting the minor.
Compare education investment programs to understand your options.
We spend the time to get to know you. Our HSBC Financial Professionals3 will discuss your education savings goals and recommend strategies.
Begin to experience the benefits of working with us by scheduling a review with an HSBC Financial Professional.
Call 800.662.3343 or from outside the U.S. or Canada, please call 847.876.1574 to speak with an HSBC Financial Professional.
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1 A single 529 Plan can have multiple share classes with different fee structures. When investing in a 529 Plan, it is important to consider the beneficiary’s age, intended holding period and purchase amounts, as these are all factors that will assist in determining which share class is most advantageous for you. For example, 529 Plan A shares are often more advantageous than 529 Plan C shares when the beneficiary is under the age of 12 at the time of purchase and the 529 Plan is established for the purpose of paying for college. Your Financial Professional can assist you in evaluating which 529 Plan share class is most appropriate for you.
2 Tax treatment of 529 Plans varies from state to state and can be a major factor in deciding which plan to select. Broker-sold plans often contain sales loads and higher fees and expenses than direct-sold plans. If your 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. The prospectus, which contains this and other information, can be obtained by calling your HSBC Securities (USA) Inc. Financial Consultant (FC). Read it carefully before you invest. For tax advice, consult your tax professional.
3 Financial professional refers to Financial Consultants (FCs), Investment Counselors (ICs), and High Net Worth Relationship Managers (HNWRMs). All offer bank products through HSBC Bank (USA) N.A, investments, annuities, and variable life insurance products through HSBC Securities (USA) Inc. and traditional insurance products through HSBC Insurance Agency (USA) Inc.