CollegeWealth helps families benefit from the tax-free advantages of 529 accounts – and guarantee the safety of their money – by offering through participating banks the opportunity to save for their children’s or their own higher education. CollegeWealth will build on the existing relationships that customers have with their banks to create tax-free and often state tax deductible 529 college savings accounts.

An affordable and familiar way to save, CollegeWealth is expected to appeal to risk-averse investors since each college savings account with a value up to $250,000* (when combined with any other holdings of an individual at any one bank) is backed by the Federal Deposit Insurance Corporation (FDIC).

*The standard insurance amount currently is $250,000 per depositor. The $250,000 limit is permanent for certain retirement accounts, which includes IRAs. The $250,000 limit is temporary for all other deposit accounts through December 31, 2013. On January 1, 2014, the standard insurance amount will return to $100,000 per depositor for all account categories except certain retirement accounts, which will remain at $250,000 per depositor.

Click here for a list of participating banks

Other features include:

• CollegeWealth is flexible, with no state residency requirement and no income phase outs;
  
  
• CollegeWealth is affordable for parents and grandparents alike, with account deposits and interest rates established by each participating bank or financial institution;
  
  
• CollegeWealth is adaptable since account owners may work with the participating bank of their choice while saving on their own budgets and timetables.

Like Virginia’s three other 529 plans, CollegeWealth account contributions will grow free of federal taxes.Withdrawals also will be tax free when used for qualified higher education expenses, including tuition, fees, room and board, textbooks, and equipment required by a college for enrollment.

Virginia taxpayers receive a $4,000 a year state tax deduction – with an unlimited carryforward – for every dollar saved in each separate CollegeWealth account.