Let me share a story with you.
A couple I know is about to have their first child go off to college. They have been saving for years with a 529 account. Recently they have learned that the money they saved has to be listed as an asset and is going to affect the amount in grants their child will be able to receive. Not only that but each university is also allowed to make their own rules on how they allow 529 accounts to be applied. I would encourage everyone using a 529 to contact their respective universities, or current universities, on their process.
This couple was able to transfer ownership to the grandparents, that way the did not have to list the money saved as an asset. The strategy going forward is to have their child apply for financial aid as any other student and have the 529 money pay for the final year of school. This is not a recommendation that everyone do in this way. But it is something to consider with your financial advisor.
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