PA 529 plan investments

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
kiddoc
Posts: 499
Joined: Mon Aug 24, 2015 10:52 pm

PA 529 plan investments

Post by kiddoc »

I hear a lot of praises about invest plans in the New York, Nevada and Utah 529 plans. Never heard much about the Pennsylvania plan. Looks like it has very reasonable costs and investment options:

https://www.pa529.com/investment-plan/

Looks like all Vanguard options with very reasonable fees. 0.5-0.6% management fees appear to be standard for most states.

Secondary question: Are contributions to the PA529 exempt from the local income tax in PA? I know they are exempt from the 3.09% state tax. Looking to wrangle out an additional 1.6% :P
"The four most dangerous words in investing are: 'this time it's different.'" - Sir John Templeton
marcopolo
Posts: 3650
Joined: Sat Dec 03, 2016 10:22 am

Re: PA 529 plan investments

Post by marcopolo »

kiddoc wrote: Tue Jan 01, 2019 12:13 pm I hear a lot of praises about invest plans in the New York, Nevada and Utah 529 plans. Never heard much about the Pennsylvania plan. Looks like it has very reasonable costs and investment options:

https://www.pa529.com/investment-plan/

Looks like all Vanguard options with very reasonable fees. 0.5-0.6% management fees appear to be standard for most states.

Secondary question: Are contributions to the PA529 exempt from the local income tax in PA? I know they are exempt from the 3.09% state tax. Looking to wrangle out an additional 1.6% :P
Much cheaper plans available. For example, I use Fidelity NH Unique plan. Management fees in the .11-.17 range for index or age based funds.

PA gives state tax break regardless of which state's plan you use.

I don't believe it is deductible from the local earned income tax, but I guess that might vary by each locality.
Once in a while you get shown the light, in the strangest of places if you look at it right.
User avatar
MedicatedMoney
Posts: 108
Joined: Mon May 28, 2007 11:22 am
Location: Philadelphia

Re: PA 529 plan investments

Post by MedicatedMoney »

We use the PA529 plan for our 4 children.
I am not a tax account but from what I understand, only state taxes are exempt not local.
We reside in Pennsylvania and have not plans to move out of state.
I know there are less expensive plans but one reason I use the PA529 is that state financial aid do not include the PA529 in determining eligibility for PA state schools. This is not the case if you use an outside state's 529.
Our plan is to help pay for the cost of state schools for our children so this is an important factor for us.
Overall, I have nothing but positive things to say about the program.
-Medicated
Topic Author
kiddoc
Posts: 499
Joined: Mon Aug 24, 2015 10:52 pm

Re: PA 529 plan investments

Post by kiddoc »

Thanks to both you. Very useful information.

As 529 plans can be rolled over once a year if I want to or move out of state, will probably start PA529.
"The four most dangerous words in investing are: 'this time it's different.'" - Sir John Templeton
HMdocinPA
Posts: 27
Joined: Tue Oct 23, 2018 5:07 pm

Re: PA 529 plan investments

Post by HMdocinPA »

I have PA529’s for my 3 kids. I believe that the PA529 has protections from creditors that are not given to 529 plans from out of state. Costs are minimally more than some other plans, but still quite reasonable.
Post Reply