As pink blossoms appear in our neighborhoods and parks, it’s a clear sign that March has arrived and brighter days are ahead. For families with young children, March often brings playful traditions—like helping kids design elaborate traps to “catch a leprechaun” in hopes of finding a legendary pot of gold at the end of a rainbow.   

Parents and teachers often encourage imagination–helping children find a little magic in their lives. As a mom and former educator, I believe imagination is powerful. It supports cognitive development, inspires creative thinking, and fuels children’s dreams. 

Dreams vs. Fairy Tales

Dreams and fairy tales serve different purposes. Fairy tales inspire imagination. Dreams shape our ambitions. Fairy tales are magical stories filled with impossible scenarios meant to entertain and teach lessons. Dreams are personal hopes that we imagine for our future; they steer us toward goals that, with planning and effort, become reality. Both have value. 

Dreams start at a young age. Encouraging kids to dream about their future shows them the world is full of opportunity. Introducing them to the many ways to pursue higher education shows them that there is more than one path they can take to achieve their dreams. When we take the step to save for our child’s education, we send an even more powerful message: “I believe in your dreams, and I’m helping you prepare for them.”

Create Your Own Pot of Gold

When it comes to funding a child’s education, families don’t rely on mythical treasure; they create their own “pot of gold”. One of the best tools for families to create a “pot of gold” is a 529 college savings plan, a tax-advantaged account designed specifically to help families save for future education expenses. 

Like fairy tales, myths are widely known, untrue tales. But they are not always magical. Despite the benefits, 529 plans are surrounded by common myths that discourage many families from using them. So, let’s clear up a few things about 529 plans. 

Common 529 Myths 

Myth: 529 funds can only be used for college.

Reality: 529 funds can be used at a wide range of accredited post-secondary programs, including community colleges, vocational or trade schools, registered apprenticeships, public and private colleges, graduate programs, and study-abroad. 529 plans can also be used for K-12 tuition and toward existing student loans.

Myth: You must use your home state’s 529 plan. 

Reality: You can participate in most 529 plans regardless of where you live. However, some states offer tax benefits to residents who use their home state’s plan.

Myth: If you enroll in a state-sponsored 529 plan, you can only use it in that state. 

Reality: 529 funds can be used worldwide for qualified education expenses, including tuition, fees, room and board, books, supplies, computers, and equipment for a student’s program of study. If a school accepts federal financial aid, it will also accept 529 funds.

Myth: If your child doesn’t go to college, the money is lost. 

Reality: You have options. If the student beneficiary doesn’t pursue higher education, you can:

  • Change the beneficiary to another eligible family member
  • Keep the account open in case they pursue higher education later
  • Roll funds into a Roth IRA for the beneficiary (following IRS limits)

Myth: 529 plans significantly reduce financial aid eligibility. 

Reality: The impact is typically minimal. A maximum of 5.64% of a parent-owned account value may be considered when determining financial aid eligibility.

Myth: Only parents can open or contribute to a 529 account. 

Reality: Anyone can contribute—parents, grandparents, relatives, and friends.  

Myth: You must save the full cost of college. 

Reality: Most plans only require a small deposit to get started. Then, you can contribute whatever fits your budget. Every dollar saved reduces the total amount your child may borrow later.

Myth: Managing investments in a 529 account is complicated. 

Reality: Most 529 plans offer simple investment options, including age-based portfolios that automatically adjust risk as your child grows up.

Turn Dreams Into Plans

Discovering a pot of gold at the end of a rainbow is unlikely, but creating one for your child’s future is entirely possible. Saving for education doesn’t need magic; it needs a plan. Many families build their savings gradually using simple strategies:

  • Open a 529 account. Compare 529 plans or find your state’s plan here.
  • Make regular contributions or set up automatic contributions (“set it and forget it”)
  • Encourage gift contributions from family and friends for birthdays, holidays, and milestones 
  • Boost savings with tax refunds, work bonuses, daycare funds that are freed up when your child starts school, etc.
  • Involve the kids—Teach them to earn money and make their own contributions.

Fairy tales have an important role in childhood. Stories of catching leprechauns and finding a pot of gold do sound magical. But, when it comes to preparing for our children’s future, the real magic is simple: plan ahead, start saving in a 529 account, make regular contributions, and watch that ‘pot of gold’ grow!   

Jenn Dyck, a Marketing & Communication Specialist for Washington Education Savings Plans (WA529). WA529 offers two 529 savings plan options: the GET 529 Prepaid Tuition Plan and WA529  Invest. Jenn lives in the beautiful Pacific Northwest and enjoys kayaking, traveling, and time with family. She is passionate about education and encourages students (and adults) to pursue higher education. Recently, she completed her bachelor’s degree while her two young adult children earned theirs. It’s never too late to pursue your dreams!