 If you want more investment choices, consider Coverdell Education Saving Accounts (ESAs).
No Investment Restrictions
Earlier known as Education IRAs, ESAs are another tax-advantaged way to pay for college. Your investment options are virtually limitless, unlike 529 plans. You can buy and sell what you want whenever you want, except for investing in life insurance contracts. Besides, you can set them up at almost any brokerage firm, mutual-fund company, or other financial institution.
Federal Tax Advantages
Withdrawals that are used for qualified education expenses are tax-free, and earnings in ESAs are tax-deferred. There is no “sunset provision” in 2011 on the tax-free status of qualified plan withdrawals, unlike 529 plans.
 Education Expenses Covered
One benefit that ESAs have over other tax-advantaged saving options is that you can make tax-free withdrawals to pay for private elementary and high school expenses, as well as post-secondary school expenses. That is why, if a private school is in the future, one option you might want to consider is saving for that expense in an ESA and using a 529 plan for college.
Contribution Limits
There are two annual contribution limits for individuals:
1. You can give up to $2,000 to any one beneficiary assuming you meet the ESA income limits discussed below.
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