Education Savings

A Coverdell Education Savings Account (ESA) offers a way to save for a child's education — from elementary/secondary all the way up to post-graduate studies — with tax-free earnings until funds are distributed.

• ANB sets up ESA offerings as a one-year IRA
• $2,000 per year maximum contribution
• After the child is 18 years old, you can no longer make contributions to this account
• Dividends grow tax-free 
• Contributions are not tax deductible 
• Withdrawals are tax-free and penalty-free when used for qualified education expenses¹ 
• To contribute to an ESA, certain income limits apply² 
• Money must be withdrawn by the time beneficiary turns 30³ 
• May be transferred without penalty to another member of the family
• Funds must be used strictly for qualified educational expenses
• There are limits on the amount that any individual can contribute for any one designated beneficiary for each year
• $25 minimum deposit to open

Learn more about Coverdell ESA accounts.

¹Qualified expenses include tuition and fees, books, supplies, board, etc.

²Consult your tax advisor to determine your contribution limit.

³Those earnings are subject to income tax and a 10% penalty.