The holidays are upon us, and if you have any children on your gift list this season, we have a great idea. Give the gift that opens doors to the future by contributing to a child’s college savings plan.

Whether you’re gifting to your own children or another’s, a contribution of college savings can provide both peace of mind and encouragement for a child, knowing that a portion of future college costs are covered. Follow our tips below as you give this holiday season.

  • Be creative. A contribution to a college savings account may not make the biggest splash with a child, especially a young one. Consider pairing your gift with a small toy or a T-shirt from your alma mater.
  • Spread the word. If you’re a parent, share with other family members how much you and your family would appreciate a gift of college savings.
  • Explain gifting options. Many state programs offer gifting options. Many state 529 programs have special gifting options where you can request gift codes that allow the gift givers to donate online directly to your 529 plan, without needing the 529 account number. Other 529 programs allow you to set up a customized College Gifting page, which can include a picture of your child and a description of his or her dreams for the future. You can easily share the page link, and family members and friends can contribute to your son or daughter’s 529 account right online.
  • Avoid gift tax. If you’re gifting money to a child’s college savings account, know that you can give up to $15,000 per year to each child without incurring federal gift tax consequences. Married couples can give $30,000. Per federal 529 laws, you can also contribute up to $75,000 per beneficiary in a single year ($1​50,000 for married couples) and take advantage of five years’ worth of tax-free gifts at one time. (Contributions are considered completed gifts and are removed from your estate, but you, as the account owner, retain control.) Upon the death of the account owner, money remaining in the account will not be included in the account owner’s estate for federal estate tax purposes. For more information, consult your tax advisor or estate-planning attorney.
  • Check with the parents. Though most families would welcome any contribution to a college savings account, check with the parents of each child receiving the gift, just in case. They may have thoughts or specific instructions on how your contribution can be made.

Many parents say they consider saving for college one of their top priorities. Help the families in your life (including your own) reach their goals by giving the gift of college savings this holiday season.


About the Author

Meredith Barnhart serves at the Director of Integrated Communications at MEFA, the Massachusetts Educational Financing Authority. Part of the MEFA team since 2012, Meredith works to provide a comprehensive curriculum of education and guidance on the college enrollment and financing process to families and colleagues, and has served as tri-chair of FAFSA® Day Massachusetts and a member of MASFAA’s Just the FACTS faculty. Before joining MEFA, she worked in finance and undergraduate financial aid for 10 years at Boston University. She received a BS in Commerce from the University of Virginia and a master’s in Higher Education Administration from Boston University.