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Michigan Education Savings Program

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MESP 529 Plan - A Good College Savings Program


Most parents are worried about how we'll pay for college for our children.  In uncertain times, this is especially worrisome for many of us.  That's why I'm thankful that I opened a **Michigan Education Savings Program (MESP)** account after my first child was born.  The **MESP** is a **529 College Savings Program** that is administered by the Michigan Department of Treasury. The benefits of an **MESP** account include: * Earnings used to pay for qualified higher education expenses are free from federal and Michigan state income taxes. * Contributions of up to $10,000 for joint filers ($5,000 for single) can be deducted from your Michigan taxable income. * Contributions may qualify for an annual gift tax exclusion of up to $12,000 per donor, per beneficiary. * Currently, there are no sales charges, start-up, or maintenance fees.   * There are seven investment options ranging from conservative to aggressive. * No annual limit on the amount that you may contribute. * It only takes $25 to open an account.  * The beneficiary can use the funds at thousands of eligible colleges nationwide and abroad. * If the beneficiary decides not to attend college, the funds can be transferred to certain family members of the original beneficiary. * Money from other 529 plans can be rolled over into the **MESP** account. * Funds from the **MESP** account can be applied towards tuition as well as other expenses such as books, supplies, required fees, and certain room and board costs. * Easy online account access and excellent communication via regular mail too. Currently, the State of Michigan is offering the opportunity to receive a matching grant of $1.00 per every $3.00 contributed to a new account.  The deadline to apply is September 30, 2008 and there are certain eligibility requirements.  As with other investments, the **MESP** account is not immune to market fluctuations.  While the account balance has mostly increased, there has been a time when the balance declined.  However, this plan is for the long-term and I'm confident that the account will continue to grow until the funds are needed.  I am extremely happy with my decision to open a **Michigan Education Savings Program** account for my children.  There is a peace of mind knowing that money is being set aside for their college costs and the tax benefits are a big plus too. Most other states have **529 College Savings Programs**, so if you are not a resident of Michigan and are interested in opening an account, check with your state.   Lastly, if you already have a 529 account and want to earn even more money, it may be worth the small effort of opening up a [Upromise][1] account.      [1]: http://www.viewpoints.com/Upromise--115220-review-74826



Michigan Education Savings Program

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