Summary
A growing number of Americans are taking advantage of a little-known rule that lets families roll unused 529 college savings into a Roth IRA, turning excess education funds into long-term retirement savings. The strategy helps avoid taxes and penalties on unused balances, but strict rules apply. The 529 account must be at least 15 years old, transfers are capped at a US$35,000 lifetime limit, and annual rollovers cannot exceed Roth IRA contribution limits. Financial experts say the provision offers greater flexibility for families worried about overfunding education accounts while giving beneficiaries a valuable head start on retirement savings.
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