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Accounts to Help You Save for Kids

Coverdell Education Savings Account (CESA)

When it comes to providing for the kids you care about, every little bit helps. A Coverdell Education Savings Account (CESA) with Thrivent Mutual Funds allows you to save towards qualified educational expenses for a designated minor child, called the beneficiary.

Why it May Be Right for You

While a parent or guardian must open the account, grandparents and basically anyone else who wants to save towards a child’s education can contribute, as long as their Modified Adjusted Gross Income (MAGI) for the year is less than $110,000 for single tax filers or $220,000 for joint filers. 

A Coverdell Education Savings Account can be used towards qualifying K-12 expenses in addition to college costs, which can offer families more flexibility.

Coverdell Highlights

Contribution Limits

  • Limit of $2,000 per year, per student total from all contributors (across any/all educational savings accounts held).  
  • Contributions may be limited based on the contributors MAGI.  See IRS Publication 970.
  • Not tax-deductible
  • No earned income requirement

Thrivent Minimum Investment

  • $1,000 per Thrivent mutual fund without recurring contributions, or
  • $50 monthly recurring contribution for all Thrivent mutual funds except for the Thrivent Money Market Fund or Thrivent Limited Maturity Bond which are $100 per month (also applies to subsequent investments)

Who Has Control

  • Parent or guardian controls until the student reaches the age of majority.  
  • Parent or guardian can elect to control for the lifetime of the account  


  • Must be taken, or transferred to another family member by the time beneficiary turns 30, unless he or she has special needs

Tax Benefits

  • Tax-deferred growth
  • Tax-free distributions if used for qualified education expenses
  • Income tax and a 10% early withdrawl penalty may apply if used for non-qualified expenses


  • Assets may be transferred to another Coverdell Educational Savings Account for the same beneficiary or to another beneficiary in the same family who is under age 30 (no age restriction for beneficiary with special needs)

Qualifying Expenses

  • K-12 and accredited postsecondary institutions: tuition, fees, books, supplies, room and board (limits apply), and required equipment and expenses for special needs services for special needs beneficiaries. K-12 only: tutoring, uniforms, transportation, supplementary items and services, technology-related expenses (Learn more about qualified expenses)

Thrivent Mutual Funds Fees

  • Annual ESA custodial fee is $15 per beneficiary. Fee may be waived if you have $50,000 or more invested in Thrivent Mutual Funds.
  • Semiannual low balance fee of $10 may apply for those accounts not maintaining minimum balance requirements.  See the Prospectus for more information
  • Coverdell ESA closeout fee of $15.
  • Additional account fees may apply for certain services and are redeemed directly from your account. Examples include overnight delivery or wire fees

Financial Aid Impact

Does this asset impact federal financial aid?

  • Yes, when combined value of assessable parents' assets—including education savings account balances owned by the parent, student, and dependent siblings—exceed the parents' asset-protection allowance1
  • No, when plan is owned by a non-household member such as a grandparent, aunt, etc., but withdrawals from third-party plans must be reported on the following year’s financial aid application and will impact future aid1

Additional Documents

1Higher Education Reconciliation Act of 2005