<p>So that the amount of $$ listed under the student's assets can be reduced, does it make sense to clear out his UGMA balance and invest in a 529, which would be considered part of the parents' assets?</p>
<p>And is there any reason one should not have both a 529 and a Prepaid Tuition Plan? Like, can my son only have one or the other?</p>
<p>Your student can have both plans and, yes, it would be to his advantage from an EFC standpoint to transfer his funds from the UGMA account to a student-owned 529.</p>
<p>Yay! I thought I read in an IRS publication that one can only have one type of Qualified Tuition Plan or the other, i.e., the 529 Savings Account or the 529 Prepaid Plan.</p>
<p>But I can’t find that now so I must be wrong.</p>
<p>There may be an IRS implication as regards the deductibility of expenses, that usually can be avoided by not “double-dipping”. Check Publication 970.</p>
<p>My parents have both a 529 & UGMA for me. what is the EFC Standpoint ? </p>
<p>Should I tell them to roll my UGMA into my 529 </p>
<p>Thanks !!!</p>
<p>Money in your UGMA will be assessed at 20% for FAFSA and money in your 529 will be assessed at 5.4%.</p>
<p>You can transfer funds from a UGMA to a custodial 529, where the title of the 2 accounts are the same. A custodial 529 is a 529 owned by the student, with the parent as custodian (assuming the student is still a minor). This is different from a parent-owned 529. So if you already have a student-owned 529, you can roll your UGMA funds over into it, otherwise you’ll need to open one. </p>
<p>Don’t roll over more funds than you need to for college because 529 funds must be spent for qualified higher education expenses (otherwise taxes/penalties will apply).</p>