What if my kid doesn't go to college? Your 529 options.
The biggest 529 myth is that it 'locks you in' to college. It doesn't. Here are six things you can do with a 529 that has nothing to do with a four-year degree.
It's the single most common reason parents put off opening a 529: 'What if my kid skips college?' Fair concern. Here's why it's a smaller risk than you think.
Six options when college isn't the path
1. Change the beneficiary to another child, sibling, niece, or even yourself.
2. Use it for K-12 tuition, up to $10,000 per year per beneficiary.
3. Use it for a registered apprenticeship — fees, books, tools.
4. Use up to $10,000 lifetime to pay down student loans for the beneficiary or their sibling.
5. Under SECURE 2.0, roll up to $35,000 over a lifetime into a Roth IRA in the beneficiary's name.
6. Withdraw the money. You'll owe income tax plus a 10% federal penalty — but only on the earnings, not your contributions.