Education Contribution Account (ECA)

  • It can be opened by the person who has parental authority and custody of the beneficiary.
  • Relatives can deposit up to the third degree of consanguinity (parents, grandparents, great-grandparents) or second degree of affinity (step-parents, grandparents-in-law). The principal and interests are insured by the FDIC.
  • Minimum initial deposit $500, may be deducted from the income tax return.
  • Available terms: 1 and 3 years.
  • Contribution is in addition to an IRA account.

Additional Information

  • Interests are computed daily on the daily balance, and they are accredited monthly.
  • Once the instrument is opened, no additional deposits or withdrawals are allowed prior to the maturity date. Withdrawals are only allowed for the beneficiary's post-secondary education, according to the restrictions imposed by the Treasury Department.
  • Penalties for withdrawals or cancellations before maturity: 1 year: 90 days interest, 3 years: 180 days interest.
  • Penalty for withdrawals or cancellations prior to the maturity date does not apply if the purpose of withdrawal is for the beneficiary's college education.
  • Processing fee is $5 per instrument for withdrawals, cancellations and returns in excess of contributions; and $20 per instrument for rollovers to an eligible institution.

For additional information call TeleBanco Popular®.


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