I'm thinking of opening an account for Mason's college expenses.
I see there's a Coverdell Educational Account which is sort of like an IRA, but for education instead of retirement. It looks like it works more like a Roth as withdrawals are tax-deductible.
Are there other plans?
Google saving for college. I see there's a 529 Plan too.
[10/2/12] Education IRAs were first introduced in 1998. The idea was to allow
families within given income guidelines to set money aside for college
without having to pay taxes on earnings or distributions. Originally,
contributions were limited to $500 per child per year. In 2001, as part
of the tax cuts signed into law under President George W. Bush, use of
the Education IRA was greatly expanded and the measure was redubbed the
Coverdell Education Savings Account after Paul Coverdell, a U.S. senator
from Georgia who had supported this expansion and who had died the year
before. Among the most significant changes were an increase in the
annual maximum contribution--to $2,000 per child--and the expansion of
covered educational expenses to include those for students in
kindergarten through 12th grade.
Fast forward a decade and here we are, with the Bush tax cuts (which
were extended under President Obama two years ago) about to expire and
taking the expanded Coverdell provisions with them. That means that,
unless Congress and the president act, beginning in 2013 Coverdell
contributions will again be limited to $500 per year, and proceeds from
Coverdell accounts will again be usable only for college-related
expenses. Other restrictions also will go into effect, including
eliminating the age-limit exclusion for special needs beneficiaries and
adding an excise tax that makes it prohibitive to contribute to both a Coverdell and a 529 account for the same beneficiary in the same year.