I came across a very interesting post that alludes to a loophole in the 529 educational savings plan. Miller over at My Pocket Change writes:
"There might be games you can play using a 529 account. I briefly looked into this at some point in the past. Basically, your money grows tax-free in a 529 account, but if you spend any gains on non-educational expenses, you pay a penalty. There is a breaking point (in time) in which even with this penalty, you’d be better off using a 529 account (given, against its intended use)."Now, given that I don't have kids and don't intend to, I would have to do some reading to understand whether or not there is something here or not. Anyone have anything to add here? Is this something that can be exploited?