It’s almost here! May 29th is 529 College Savings Day to highlight the importance of having a 529 savings plan in place to pay for your children’s higher education expenses. Use this month as an opportunity to speak to your advisor about your children’s future so that you and your family can enjoy the big moments without a worry.
So, what is a 529 Plan? These education savings plans are designed to help families put a plan in place to start setting aside funds for their children’s future education costs. These plans are called a 529 because they are named after the Section 529 of the Internal Revenue Code. This was created in 1996, and have been helping families since. There’s also a lot of flexibility when it comes to how a 529 account can help you and your children. It does not only cover higher education costs, but also housing, meals, computers, or books that are required for their education. These funds have no limits either, allowing your child to use the funds across schools in the US, as well as around the world.
The best part? You never pay tax on the growth the account earns. This account will set you up with the opportunity to contribute as much as you can to this account, and reap the benefits of its growth without any downfall. The money that the 529 account earns overtime will not be taxed when you take the funds out to pay for your child’s education.
There is also no minimum for saving. This gives you the freedom to contribute as much as you see fit for your budget at the time. You have the choice to increase or decrease how much you contribute, and when you contribute. Every time you add funds into the account, just know it is a step closer to giving your children the life you want them to have.
Getting started is easy as well. Talk to your advisor, no matter how young your child is, about starting a 529 account. It has never been easier to help save for your child’s future. No matter what path they choose, your family will be prepared when it comes time. As little as $1 to $500 set aside for future education encourages a child to do better in high school.
529 Savings are a very powerful tool. Having a plan in place allows your future student to have more freedom when they are choosing what they want their higher education experience to look like. Putting aside funds for your children is an exciting time! Take this opportunity to talk to your child about what they want to be when they grow up, and what goals they have in mind. Talking to your children about this, even at a young age, will help them dream big and succeed!