Oklahoma 529 College Savings Plan (OCSP)The OCSP allows you to save for college education and gain some tax benefits along the way. Contributions to an Oklahoma 529 plan grow federal and state tax deferred amd as long as the disbursements are used for approved educational purposes, they are federal and state tax free. While that alone makes it worthwhile, Oklahoma taxpayers are also allowed to deduct up to 10,000 ($20,000 for married couples filing jointly) from your Oklahoma taxable income.
The Oklahoma 529 Savings Plan offers nine different investment plans. There are three Managed Allocation Portfolios, conservative, moderate and aggressive. These plans begin more aggressively when the beneficiary is young, and as they grow towards college age, the investments move to more conservative instruments.
Next are three equity portfolios, which invest in funds that include mostly stocks. These can be volatile and are probably not for someone with a short time horizon. The U.S. Equity Index Option will track a broad U.S. market index. The Diversified Equity Option invests in funds both domestic and international, as well as real estate relsted fund. The Global Equity Index Option uses the same types of investments as the Diversified Fund and it isn't very clear from the description what the difference is between them.
The final three portfolios are for the more conservative investor. The Balanced Option offers investments in stock funds, bond index fund, fixed-income funds and a real estate-related securities fund. While not as aggressive as the equity portfolios, these offer moderate risk and the values may fluctuate depending on the actions of the markets. The Fixed Income Option offers a moderate rate of return, while keying in on preservation of capital. Finally, the Guaranteed Option maintains full capital preservation along with a guaranteed rate of return.
For more information on the Oklahoma 529 College Savings Plan, visit their website at http://www.ok4saving.org. You should also check with a financial advisor and tax advisor to see if a 529 investment is right for you.
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