Understanding successor planning with 529 plans

As an advisor, you help your clients plan for and navigate different stages of life.

Have you considered how you can prepare your 529 clients for times of transition, especially in the event of a tragedy?

A significant part of the preparation is having clients name a successor to their my529 accounts. If an account owner passes away, the successor account owner will assume all rights and obligations to the account.

What happens if there is no successor?

Should an account owner die without a successor in place while the ust, and are governed by special rules. Learn more in the my529 Program Description. If the beneficiary is an adult when the account owner dies, the account ownership is transferred to the beneficiary.

How to assist clients in successor planning

While advisors cannot set up successors, there are a number of ways you can support clients in their successor planning:

  • Have the account owner submit Form 515 (Primary/Secondary Successor Owner Designation, Change, or Removal).
  • If a client would prefer to complete the information on their own, they can designate, change, or remove primary and secondary successor account owners in their online account at my529.org.
  • If the client wishes to name a trust, corporation or entity as a successor, they can do so using Form 515. They will need to include specific information about the trust, corporation or entity (see page 12 of the my529 Program Description).
  • For new my529 accounts, clients can designate a primary and secondary successor online at account opening. Similarly, they can also add a successor on when they open an account with Form 100 (Individual Account Agreement).

It may be prudent to evaluate clients’ accounts and determine which need to add successors. You can view successor information in the Account Details section of your client’s my529 online account or in your Current Date Summary Report.

Having a conversation about successor my529 account owners with your clients is a starting point for preparing them for a worst-case scenario, and it is another way to foster rapport with them.

Questions?

As always, your my529 Professional Services Team is here to help if you would like more information.

Contact us at advisorinfo@my529.org or toll-free at 888.529.1886.

You can also schedule time with us at calendly.com/advisorinfo.