By Emily Roozen, Business Development Coordinator, CollegeInvest
August 31, 2021
September is College Savings Month and what a perfect time to start thinking about what a college savings account can do for you. As we transition into fall and schools start back up, we are also starting to build new routines for the season. Perhaps you are cancelling those pool memberships, building some self-care into your daily routine, or simply trying to save money after a long summer of events and vacations. In any event, now is a great time consider rerouting money into a 529 account.
529 accounts are not the sexiest investment, but they do have incredible perks that are often overlooked. 529 dollars can be spent at thousands of institutions worldwide, the investment strategies are diverse, and they are insanely flexible. Take me for example. I am a 28-year-old single female who opened an account for myself a couple of years ago. I love knowing that I started saving for the future in a way that gives me incredible opportunity. I can use the funds to get my master’s degree or to simply take that Microsoft Excel class at the local community college that I have been putting off for years. I do not have a family now, but I hope to have one someday. I take solace knowing that 529s allow for beneficiary changes with relative ease. There are no tax implications when changing the beneficiary to someone the IRS defines as a relative. This broad definition includes not only the original beneficiary’s immediate family, but extends to aunts, uncles, cousins, nieces and nephews, stepsiblings, grandparents, and the spouses of all these persons. Whether I use my savings for my immediate family or for my extended family, it is nice to know that my preparation of saving today has the flexibility of numerous uses later on.
Saving for college looks different for everyone. Some might save in large lump sums while others contribute incrementally in amounts they can afford. Regardless of how you contribute, when saving in a 529 account, account owners have immense flexibility. This lends itself nicely to the upcoming holiday season. Establishing an account now means that you could easily invest those holiday checks and bonuses. You might also reroute some of those summer funds into a 529 account. The beauty of investing in a 529 account is that saving just $40 a month can help buy books and supplies, a meal plan, or room and board.
September starts the fall season. As we transition, it is not only a time to reflect on the past summer but also to focus on what the future could look like. How can you set yourself up for success? Starting a 529 account today can lead to great opportunities and all it takes to get started is rerouting a summer expenditure or two!
About the author:
Emily Roozen works as the Business Development Coordinator for CollegeInvest, the State of Colorado’s 529 program. She operates with a team of amazing individuals to help educate advisors about the features of a 529 education savings account. She thoroughly enjoys hearing the creative questions people ask, knowing that every 529 dollar is going to help someone extend their education.