By Brian Moore, Senior Manager, Path2College 529 Plan
August 15, 2017
Can you believe that summer is almost over and it’s already time for back to school shopping? Reports show that parents will spend an estimated $700 per child this year on back to school shopping!
For parents, it may seem that those school supply lists are endless. Folders, pencils, crayons, glue sticks, notebooks and rulers. While the list goes on and on, the utility of these supplies end when the school year is over. These items offer a temporal benefit and they are items you will have to purchase again next year.
What if an item on your “school supply list” could have a benefit that lasts beyond this school year? If you add a 529 College Savings Plan to that list, you can get so much more since it’s one of the best investments that you can make in your child’s future. It’s the one “supply item” that can have unlimited benefits!
A 529 College Savings Plan is a tax-advantaged investment account that helps parents, grandparents, aunts, and uncles save for the future costs of college for their children, grandchildren, and loved ones.
Just as school supplies prepare our kids for a successful school year, a 529 College Savings Plan prepares them financially for college. Here are a few reasons it makes a great addition to your supply list this school year:
1. Federal and State Tax Advantages – Any investment earnings grow tax deferred, and qualified withdrawals are tax-free. Some states may also offer a tax deduction or tax credit for contributing to a 529 plan.
2. Studies have shown that having a college savings makes a child three times more likely to attend college and four times more likely to graduate than if they did not have one. (Better Together, May 2017)
3. Every dollar saved is one less dollar that you or your child will have to take out in student loans to pay for college. Borrowing is always more expensive than saving.
4. Use the funds for more than just tuition – can be used to pay for tuition, certain room and board costs, computers and related technology expenses as well as fees, books, supplies, and other equipment.
5. Use funds at any eligible university, college or vocational school nationwide – and many abroad.
The new school year is the perfect time to consider opening a 529 College Savings Plan. In addition to shopping for all those new school supplies, make sure you send your kids back to school with the most important supply of all – a 529 College Savings Plan. So don’t delay; contact your state’s 529 plan to open one today!