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Coverdell Education Savings Account

Create an easier transition into the next stage of life for yourself and your student by setting aside in savings early. A Coverdell Education Savings Account (ESA) provides a tax-free safe place to grow competitive interest and also financial confidence as your child takes the next step in their educational development.

Summary
  • Set aside funds for your child's or other beneficiary's elementary, secondary, and/or higher education
  • No setup or annual fee
  • Interest grows tax-free
  • Withdrawals are tax-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  • The money must be withdrawn by the time beneficiary turns 30***
  • The ESA may be transferred to another member of the family following IRS guidelines 
  • $1,000 minimum deposit to open 
  • $1,000  minimum balance required to maintain account 

*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.