Save for qualified education expenses for yourself and your student by setting up a savings account early. A Coverdell Education Savings Account (ESA) provides a tax-free safe place to grow competitive dividends — as well as financial confidence for a new stage in life.
- Set aside funds for your child's education
- No setup or annual fee
- Dividends grow tax-free
- Withdrawals are tax-free and penalty-free when used for qualified education expenses*
- Designated beneficiary must be under 18 when contributions are made
- To contribute to an ESA, certain income limits apply**
- Contributions are not tax deductible
- $2,000 maximum annual contribution per child
- The money must be withdrawn by the time he or she turns 30***
- The ESA may be transferred without penalty to another member of the family
- No minimum deposit to open
*Qualified expenses include tuition and fees, books, supplies, board, etc.
**Consult your tax advisor to determine your contribution limit.
***Those earnings are subject to income tax and a 10% penalty.