For many Americans, their first thought when choosing an emergency fund will be how much is too much.
The answer is: it depends.
Here are some guidelines for figuring out if you’re able to afford a 529 for your family.
How much is enough?
If you’re already saving enough to cover the costs of retirement, you should be able to save enough to meet the minimum required to qualify for a 529.
However, if you’ve been saving too little or too much, you might need to consider some of the other options for saving for retirement.
First, it’s important to keep in mind that 529s are not tax-free.
They are tax-deductible, but they can’t be used to purchase a home or car.
And if you don’t qualify for tax deductions for 529s, the funds aren’t tax-exempt.
For example, if your annual income is between $50,000 and $75,000, you’ll have to pay income taxes on $25,000 of your $100,000 income.
But you could save enough for an emergency account for yourself and one for your child to pay the $5,000 to $10,000 in taxes.
You could also use 529 savings to buy a home, which would qualify you for the same tax breaks as a Roth IRA.
You can also use your 529 savings for qualified charitable or educational purposes, including for college scholarships.
To help you choose, here are some resources to help you make the right decision:Here’s what your tax bill could look like if you qualify for the minimum $100 contribution required to contribute to a 529:Here are two things you should consider before you make a decision:The 529 plan itself is the most important factor.
If you can save enough money for a tax-advantaged account, you’re set.
The account is not tax deductible and the money is taxed at your personal rate.
However the money you make will still be taxed as ordinary income.
In addition, if the account is a Roth, you may be able see an additional deduction of up to $5.5 million.
In this case, you’d be able use the money to pay down your debt or buy a new home.
If you are already in a 529 account, the account could help you reduce your overall tax bill.
If your income is low, and you have enough money to meet your 529 contribution, you can use the 529 to reduce your taxable income, but the money won’t be taxed at a low rate.
However, if most of your income comes from wages, the plan will be taxed more heavily.
The federal income tax rate for wages is 23.8 percent, while for contributions the rate is 28 percent.
