How does it work?
Anyone can contribute, and anyone can be a beneficiary
Invest as little as $25 or as much as $150,000 for each beneficiary
Earnings grow federally tax-deferred
You retain access to your money
You can change your beneficiary at any time
Notes:
So how does it work? By providing you with unprecedented flexibility:
- With Scholars Choice, anyone can contribute, regardless of income level, and anyone can be a beneficiary, regardless of age.
- You can invest as little as $25 or as much as $150,000 for each beneficiary.
- Your contributions are invested in a portfolio of Smith Barney Funds, where your earnings will grow federally tax-deferred.
[IMPORTANT NOTE: Before the presentation, FCs should check FCI: SCH for information on his or her state’s tax treatment of contributions, earnings and withdrawals from Scholars Choice accounts and should briefly elaborate on them at this point.]
- Unlike a custodial account, you retain access to the money in the account at all times. That means that you can take it out at any time, although you will be subject to regular taxation plus a 10% penalty on earnings.
- You can also change the beneficiary of the account at any time to a family member of the original beneficiary.