WASHINGTON, May 18, 2021 /PRNewswire-PRWeb/ -- May 29th has been proclaimed National 529 Day by the Registrar at the National Day Calendar, a designation sponsored by the College Savings Foundation (CSF) to encourage more families to learn about the increasing flexibility of 529 savings plans in funding their education futures.
"529s have never been more versatile for people of all incomes, ages and educational paths. As a nation, we are redefining what higher education looks like – from online universities to career and technical certifications. And, as an organization dedicated to helping families save for it, CSF is proud to have May 29 on the National Day Calendar designated as an ongoing reminder of how valuable 529 savings plans are in attaining their goals," said Vivian Tsai, CSF Chair.
529 education savings plans – "529s" as they are known – are a tax-favored way to save for a child or parent's future. Originally established to pay for higher education expenses, the use of these plans, where earnings grow tax-free when used to pay for qualified expenses, has expanded significantly to fund a wide range of uses throughout a person's life:
- In addition to covering post-secondary education such as traditional public and private colleges and universities, career and technical schools, and apprenticeships, 529s can also be used for K-12 education, and adult education and retraining.
- Eligible expenses include tuition, room and board, fees, books and computers and related services.
- Up to $10,000 (lifetime per a beneficiary) can be used to pay down a student loan.
"Just opening a 529 plan is a powerful motivator for children," Tsai added. "Research shows that children of all income levels who have a designated savings account are more likely to attend and to graduate from college. Meanwhile, for every dollar saved in a 529 plan, a family is avoiding more than a dollar of debt when the time comes to pay tuition or the inevitable other expenses," she added.
529 plans are being used by young people as well as by their parents. In CSF's recently-released survey of over 1,000 high school students, 56% of those surveyed are saving for higher education, with 23% of them using 529 plans as their primary way to save. 69% of them reported that their parents were also saving for higher ed, with 23% of them using 529s as their primary savings vehicle.
In concert with the "National 529 Day" designation, CSF has added features to its website including a section called "Open a 529 Plan" to walk families through the process: what they'll need to start their plan; how they can use them; ways that grandparents, family members and friends can contribute, and common misconceptions. For example, the site clarifies the minimal effect of 529s on financial aid eligibility, and how 529 plans can be changed to benefit different children, or even the parent, depending on their individual needs.
The CSF site includes up-to-date higher education planning and saving tools from CSF members Invite Education and Savingforcollege.com. It also provides families with a central place to go for information about what is considered eligible as higher education expenses from the Department of Education and how they can use 529s and learn about apprenticeships for all ages at apprenticeship.gov.
The College Savings Foundation (CSF) is a Washington, D.C.- based not-for-profit organization helping American families achieve their education savings goals. http://www.collegesavingsfoundation.org
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SOURCE College Savings Foundation
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