By Mary Lehman, Senior Director, Marketing, TIAA
In recognition of Dr. Martin Luther King Jr.’s birthday on Jan. 15 and the national holiday on Jan. 20, I was inspired to write about a personal dream that I have had that originated almost 28 years ago when my first child was born. Like many parents, my dream was to provide the best life and future for my daughter. Of course, this included basics such as love, keeping her safe, good nutrition and quality child care while I was at work. Another critical objective was in securing her future by providing as much financial assistance as possible towards her future higher education expenses. With this in mind, I immediately opened a dedicated account specifically for college savings.
Back in 1992, 529 college savings programs did not exist. At the time, I was an investment representative and instead opened a mutual fund account for my daughter registered as an UGMA (Uniform Gift to Minors Account). Seven years later, I found myself interviewing for a position with TIAA for a position in its newly created 529 plan education savings division. During the interview, I learned my home state was launching a 529 plan offering an attractive state income tax deduction for plan contributions and tax-advantaged earnings. I remember thinking, “This investment vehicle sounds too good to be true,” and “When can I open an account?”
Upon joining TIAA in 1999, I immediately stopped funding my UGMA account and instead opened 529 accounts for my daughter and my son, who was born in 1996. I subsequently opened a 529 account for my youngest in 2002. I’m proud to say I’ve been a supporter of 529s since their creation as an investment vehicle, which has added to my passion for marketing 529 plans over the last twenty years.
I have witnessed the benefits of these plans firsthand. Outside of the beneficial tax advantages, I was able to transfer the remaining funds my daughter didn’t use to my son’s account. My son used his 529 funds to make possible the pursuit of his degree in psychology. And later this year, my youngest son will use his funds to pursue his dream of attending a professional flight program.
My word of advice to parents is to save what you can, when you can, for as long as you can, while giving yourself a tax bonus. Thank you to the visionaries who made section 529 plans possible as your foresight significantly helped my middle-class family achieve my dream and future opportunities for my children. And thank you to all visionaries, including the late Dr. King who have made a difference for so many.
About the author:
Mary Lehman leads a team of professional program marketing managers responsible for the management and execution of state 529 college savings plans for TIAA-CREF Tuition Financing, Inc. (TFI). TFI is a pioneer in the management of 529 college savings plans, having provided program management and administration of 529 plans since signed into law more than two decades ago. TFI is committed to helping families save for their loved ones’ college education through low-cost, high-value 529 college savings plans—a natural extension of TIAA’s commitment to higher education.