College plan is new and improved

If you haven't considered the Illinois Bright Directions college savings plan, now is a good time to take a look.

Bright Directions, a so-called “529” plan, is a big improvement over Illinois' Bright Start program –  it has more and better investment options and lower expenses.

Parents, grandparents and others can open an account and receive a state tax deduction of up to $20,000 (married filing jointly) for contributions, which grow tax-deferred until withdrawal. Withdrawals in excess of basis are tax-free if used for qualified higher-education expenses, under current law.

Another important benefit: 529-plan assets belong to the account holder, not the beneficiary. This may result in a higher level of financial aid for the student.

Clients of Mentor Capital Management Inc. are eligible to participate in Bright Directions without sales or service charges. Call us for more information.