Saving for education
Start your child off on the right foot with a smart savings plan for college.

Prepare for college costs with Coverdell

Much like a Roth IRA, the benefits of a Coverdell Education Savings Account from FTB Advisors, Inc. include tax-deferred earnings and tax-free qualified withdrawals.

To help you plan ahead for this significant event, a Coverdell account should be part of your comprehensive financial plan.

Product Features

  • Tax-deferred earnings
  • Tax-free qualified withdrawals
  • Lenient contribution requirements – both relatives and friends may give to the account


529 Educational Savings Plan

Designed to help keep up with the rising costs of college education, you as the donor maintain control of a 529 Educational Savings Plan. A tax-advantaged investment, the 529 Savings Plan has no income or age restrictions, so it's easy to provide a solid foundation for your child's college education.

Contributions are considered completed gifts so a donor can make a maximum annual contribution of $14,000, or $70,000 ($140,000 for a joint gift) in one year using a prorated Annual Exclusion gift for five consecutive years

Product Features

  • Tax-advantaged earnings
  • Donor maintains control of account*
  • No income or age restrictions
  • Annual contributions up to $14,000
  • For gift tax purposes, it is considered a completed gift even though you maintain control of the assets


Coverdell or 529? Compare options

Who can contribute? Contribution limit Qualified distributions Income tax considerations
529 Plans 
Anyone 
  • Maximum contribution limits, which vary by plan.
  • Contributions must be in the form of cash.
Federally tax-free if used for qualified education expenses. 
  • Earnings in the plan accumulate tax-free.
  • Withdrawals are federally tax-free if used for qualified higher education expenses.**
  • State tax benefits may also be available.***
Coverdell Savings Accounts 
 Anyone (certain income limitations may apply)
  • Contributions from all sources cannot exceed $2,000 per year per beneficiary.
  • Contributions must be in the form of cash. 
Federally tax-free if used for qualified education expenses, including primary and secondary education.   
  • Qualified withdrawals are not subject to federal income tax.
  • Earnings on the account in the plan accumulate tax-free.

Traditional IRA

First Tennessee Bank can help you learn how much you need to save for retirement ​

Reach your retirement goals with tax-deferred savings.

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