The InvestEd Plan, available through an investment in
Waddell & Reed InvestEd Portfolios, allows employees to
predetermine an amount of at least $25 that will
be automatically deducted from their paychecks and
invested in a college savings account.
The program is available to any size business free of charge, and Waddell & Reed financial advisors will provide employers all enrollment support and materials.
Investments in 529 plans grow tax-deferred until withdrawn, and from 2002, when assets are withdrawn for qualified higher education expenses such as tuition, room and board or books, the earnings will be federal income tax free.
Further, unlike Uniform Transfer to Minor accounts, the account owner retains control after the beneficiary reaches legal age, ensuring that the money saved is used for education expenses.
Waddell & Reed launched the InvestEd Plan last October.