This is an education savings account (ESA) that allows tax-advantaged earnings and withdrawals to pay for the education of the beneficiary of the account. All funds must be used for educational expenses for the designated beneficiary.
Earned income is not necessary in order to contribute to an ESA, and annual contributions are not required. Anyone, including the designated beneficiary, can contribute to the account.
With a self-directed ESA from Advanta IRA, you have the potential to increase your savings and gain tax-free wealth for your child’s educational needs by investing in assets that you understand such as real estate, partnerships, notes, and more. Investing in alternative assets allows parents or grandparents to put their expertise to work for the benefit of their children’s (or grandchildren’s) education savings.