<p>Georgia does have its own 529 plan:
[Path2College</a> 529 Plan](<a href=“http://www.path2college529.com/index.html]Path2College”>http://www.path2college529.com/index.html)</p>
<p>And if you use their plan, contributions up to $2000 are exempt from Georgia state income tax: “You May Be Eligible for a Georgia Income Tax Deduction
All Georgia taxpayers may now contribute and deduct up to $2,000 each year on behalf of any beneficiary regardless of their annual income. Georgia taxpayers are not required to itemize deductions to make this adjustment to income. Please note that a transfer of funds from another state’s 529 plan is not eligible for the Georgia income tax deduction. Georgia tax forms refer to the Path2College 529 Plan as “Georgia Higher Education Savings Plan” (GHESP); the Path2College 529 Plan is established by the GHESP.”</p>
<p>[Benefits</a> and Tax Advantages : Path2College 529 Plan](<a href=“http://www.path2college529.com/benefits/index.shtml]Benefits”>http://www.path2college529.com/benefits/index.shtml)</p>
<p>We have a similar plan in our state (also administered by TIAA-CREF, like Georgia’s). Since we started it just before our kids started college (and continue to contribute while they are in school, for the state tax benefits), we have all our $$ in the “guaranteed option” – you make 2-3% per year, but CANNOT lose money. THe Georgia plan has the same option.
We are more fortunate, in terms of our state tax laws, because married couples filing jointly can exempt up to $20,000 (annually) in 529 contributions from state income tax. In our state, the funds only have to be in the 529 for 10 business days before they can be withdrawn. (just called the toll-free # for the Georgia plan, and the 10-day requirement is the same.)</p>
<p>We funnel all the money that we are paying for qualified education expenses (tuition, mandatory fees, required books and supplies, room & board) through our 529 accounts in order to get the state tax deduction. Saved us a few hundred dollars last year (with one kid in school for one quarter), will be a lot more this year with two in school, and with us (hopefully) able to pay quite a bit more out of pocket and not having to borrow so much. (that application year, with all its costs, plus outfitting a dorm, etc is VERY expensive – then after the kids are gone, household expenses are less)</p>
<p>Note that, at least w/ the TIAA-CREF-run plans, you CAN lose money in the Money-Market option. Their “guaranteed option” is risk-free.</p>