Disclosure: I received compensation to write this post on behalf of One2One Network and ScholarShare. All opinions are expressed are my own.
Let’s face it: kids are expensive. VERY expensive. Because our kids are so close in age (Ethan’s just 2 years older than the girls), we have been thinking about the fact that we should probably start saving for college. And that’s why we are considering setting up a 529 college savings plan for them. What is a 529 College Savings Plan you ask? Let me explain….
What Is A 529 College Savings Plan?
Basically a 529 college savings plan is a college tuition plan that you can set up for your children. Think of it as a savings account for college. The plan is is tax-free both on savings and investments, as long as it is used for qualified expenses. There are also no income limitations on contributors.
All 50 states offer at least one 529 college savings plan, and many states offer a tax deduction to those who use their state’s plan. So it’s like you’re saving twice!
ScholarShare has information about how 529 college savings plans work, how to figure out how much you need to save, who can open an account (anyone!), the different ways you can invest, and the fees associated with the plan.
It doesn’t matter if your child goes to a private or public college or university, in-state or out-of-state, trade or graduate school. All of the money that you invest can be used at any eligible higher educational institution in the nation and even several abroad. You can use the funds for more than just tuition – mandatory fees, books, supplies, equipment, etc. is also covered.
But what happens if your child named on the account doesn’t attend college? It doesn’t matter why they don’t attend, you won’t lose your money. You have the ability to transfer the funds to another beneficiary in the family or withdraw the funds for any use (an additional withdraw tax penalty of 10%).
I don’t want my kids to have to try to figure out on their own how to pay for college. I want to give them a head start without worrying about climbing into a sea of debt before they even get their careers going. Now that I know about ScholarShare and more fully understand 529 college savings plans, I’ll be able to plan and help them go to college without the burden of debt.
Friday is National 529 Day! May 29th is a day celebrated nationally by state-sponsored 529 plans, to raise awareness about the importance of saving for college and the value of 529 college savings plans. In celebration of National 529 Day on May 29, 2015, ScholarShare launched its 529 Day matching promotion, “You Start It, We Match It.” If you open a ScholarShare 529 College Savings Account on Friday, May 29, 2015 from 12:01am to 11:59pm PT, ScholarShare will match $50 of the initial deposit!
So help spread the word! Share, tweet, post, pin, or email this information to your friends and family. Knowing what a 529 college savings plan is will help us all be able to plan and make informed decisions about our children’s futures.