Considerations
Many states offer college savings plans known as Section 529 Plans. Investments in these plans are tax-deferred. Withdrawals used for educational expenses are tax-free. The details of these plans vary from state to state, so it will be necessary for you to become familiar with the details of your state's plan before you decide to use it as part of your college savings investment strategy. Starting in 2003, private institutions of learning have been able to offer 529 plans too.