Coverdell Education Savings
A Coverdell education savings account offers flexibility and provides tax-free treatment for your investment earnings. You can use the money for a variety of educational expenses such as private school tuition, academic tutoring, college and graduate school tuition and more.
| Features | Benefits |
|---|---|
| No required annual contributions | Flexible |
| No minimum balance required. However, if the CESA aggregate balance drops below $100 there is a $10 monthly fee | Flexible |
| Maximum annual contribution per child is $2,000 | Savings |
| Dividends are calculated using the average daily balance method and compounded monthly | Earns dividends |
| Distributions to pay for elementary, secondary and higher education are tax free | Savings |
| Earnings withdrawn for a qualified distribution are tax and penalty free | Savings, peace of mind |
| Rates and deposit terms are same as traditional IRAs | Flexible |
| Age limit of 18 for contributions | Convenient |
| Distributions must be completed by age 30; funds can be transferred from the child’s account to another family member under the age of 30 | Convenient |
| Contributions can be made up to the tax return deadline each year | Convenient |
| You may access your account in person, online banking and through mail | Convenient |
| Federally insured by NCUA for up to $250,000 | Peace of mind |
