529 College Savings PlanSaving money with a 529 college savings plan is yet another section of the IRS code, section 529. It is a plan that helps families set some money aside for their kids education to fund their college expenses in the future. Most states have a 529 College Savings Plan. It is an easy way to save for college. You can open an account with as little as $50.00 shortly after your child is born or thereafter, but the sooner the better. It will require his or her Social Security Number to get started. Companies such as Vanguard and Fidelity offer these plans as well, but I think it's best to go with your state. I know the tax savings are much greater and there are incentives if your child and family decide to remain in the state to attend a local college or university. Moreover, contributions to your state's plan may be deductible on your state income tax return. The most important feature here is that earnings grow tax-free. Withdrawals are free from federal income tax if they pay for qualified educational expenses such as tuition, room and board and other expenses covered under the plan. Your state may also offer tax free withdrawal. The benefits here are too many for a family not to participate in the plan. Each year college tuition and other expenses keep rising. We read and hear about it all the time. Every family should take advantage of this simple way to save. Forget savings bonds, setup and an account and make it automatic with a monthly contribution that is automatically withdrawn from your checking account. Another great thing about these plans is that family members can make gift contributions to the plan. You can contribute up to 60K or 120K for a married couple filing jointly. During holidays and birthdays tell your family and friends that you have a 529 college savings plan setup for your child. It is an easy gift, no shopping required just write out a check to the plan and include the account number and send it in. Remember, college is only going to get more expensive so the sooner you start the better you and your child will be. For more information and to compare plans by state, please click on this link:
529 Resource Page
A Note About College EducationThe last few years have seen thousands of kids graduating from college, but are unable to find a job. A lot of these young adults don't have any experience and depending on the major they may never work in their particular field of study. Moreover, they may never recoup their college expense, which can reach very high. Let's not forget that interest in involved as well. We hope that they are able to find good decent paying jobs so please look deep and research the areas of your/their education. The sciences, healthcare, environment and technology and alternative energy will be in huge demand in the years to come. Please don't get an education for the sake of getting one. Think about it for a bit and make an educated decision. You want an area of study that will ensure a significant job or career. Make no mistake the universities in this country are lagging behind the rest of the world. Think twice if an education is even worth it. Don't get me wrong, but most kids today are lacking basic skills especially young men. Teach your kids how to fix things and get back to basic and start gardening and learning about our wonderful planet earth. They may discover new ideas for education and problem solving skills. Back to 529 College Savings Plan Back to the Homepage 
|
