The 529 savings plan is generally the best way to save money for a child's future college expenses, but these accounts don't necessarily have to be opened by parents -- grandparents can open 529s if they want to as well. In this Fool Live video clip, recorded on June 16, certified financial planners Matt Frankel and Robert Brokamp discuss what grandparents should know before they open an account. 

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Matt Frankel: George says, and here's one that I know pretty well. "If as a grandparent, I contribute to a 529 account for my grandkids, can I take a tax credit for that, or are the parents only entitled to that as they are the custodians of the account? Will I have to open a separate one for them?" There's a couple of parts of that question and I, being a parent of two little kids, I can tell you that my parents contribute to 529s for both of my kids, and I don't get the tax break for it. They absolutely take the tax break for the money they put in. To do that, though, they have to open a separate account. The tax break goes to the person who owns the account. Technically, I own my kids' 529 accounts that I opened for them. My parents own the 529 accounts that they opened. They would get hit with a penalty, but they could withdraw that money if they wanted to, I can't. It depends who owns the account, who is in control of the money as to who gets the tax break. What I will warn with 529s for grandparents, a lot of times I see this, and it sneaks up on people. If you put too much in a 529 at once, you could get hit with the gift tax, if that's a situation for you. I know the IRS, lets your preload, I think five years in advance of gift contributions, the annual gift limit. Bro, I'm a little out of date. It's about $15,000 is the annual exemption still, correct?

Robert Brokamp: Yes.

Frankel: OK. Awesome. I took my CFP exam a few years ago, and it was different. The IRS lets you preload a certain number of years for that. But if you exceed that, it could have gift tax implications if that applies to you. With that, I'll end there.

Brokamp: Yeah, and I've probably mentioned this a million times and get tired of mentioning it, but there are some financial aid implications of grandparents owning 529s. The assets are not included on the FAFSA, but the distributions are for the following year. But all that's going to change in a few years. They're tweaking how the FAFSA works. If you do have grandparent-owned 529s, just look into the financial aid implications of that and the great source that is