I have a child who is a college-bound high school senior.
We live in a high tax state that offers a tax deduction on contributions of up to $10K per year to the state's 529 plan.
At this time we have about 40% of the projected cost of a four year education in the 529 plan. We don't have a great deal of non-retirement savings to cover college costs but we have good current income and a HELOC that gives us flexibility to on tuition payment timing.
What is my best allowed strategy for contributions and withdrawals for the time that she is in college?
Can I continue to make contributions (to get the tax break) while also making withdrawals to cover current costs in the same year?
Would I be better off minimizing/deferring the withdrawals for as long as I can afford to?
Since this is our only child the ideal outcome would be for the fund to be empty at the end of her four year college term.