A 529 plan is a valuable tool for saving for your grandkids’ college education, allowing contributors to prepay qualified higher education expenses or contribute to an account for those expenses. While contributions are made with after-federal-tax money, they grow tax-free at both federal and state levels. Thanks to the FAFSA Simplification Act, which will be finalized in the 2024-25 school year, grandparents with 529 accounts can benefit from the “grandparent loophole” due to simplified processes for federal student aid applications.
