NASFAA reminds families interested in putting money away for college that 529 plans can help defray costs for things other than just tuition and fees.
Washington, D.C. (PRWEB) May 27, 2016
With May 29—also known as 529 Day, or a day of national observance for the tax-advantaged education savings plans operated by states and educational institutions—quickly approaching, the National Association of Student Financial Aid Administrators (NASFAA) offers tips to help educate families of prospective college students on the benefits they offer.
According to a new report released this month by Edward Jones, 72 percent of Americans aren't familiar with 529 plans and the many educational costs they can help to cover. This is up from the 66 percent who reported they didn't know what a 529 plan was just one year ago.
With all 50 states and D.C. offering at least one 529 plan, 529 plans are a great investment tool that can help cover college costs down the road. And that doesn't just mean tuition and fees.
Here are three things families may not realize can be covered under a 529 plan:
1. Computer technology and related equipment or services, such as Internet: College students live in a tech-heavy world and most will need help affording the tools to keep up in the classroom. Money from a 529 plan can be used to purchase a computer, printer, computer software, Internet access, and other equipment a student needs for their education.
2. Textbooks and supplies: It’s no secret that college textbooks and other materials for the classroom are expensive and many students take on additional student loans to pay for them. Most 529 plans allow students and families to cover these costs with money from the account, helping to avoid borrowing more money.
3. Food: Many schools require students who live on campus to purchase a meal plan, which can be paid for using funds from a 529 account.
"We're seeing some movement on Capitol Hill that shows members of Congress are interested, not just in reducing loan indebtedness, but also in encouraging families to learn more about ways to put away money for college," said Megan McClean Coval, NASFAA's vice president of policy & federal relations. "The Boost Savings for College Act introduced last month by Sen. Burr (R-NC), and Rep. Luján's (D-NM) Save for Success Act introduced in March, both look to increase or modify the use of 529 plans for college savings. We're supportive of efforts that aim to increase access to college while also reducing the amount families would potentially have to borrow.”
For more information on 529 plans and other ways to save and pay for college, contact NASFAA at 202-785-6959 or news(at)nasfaa(dot)org to set up an interview with a subject expert.
About NASFAA
The National Association of Student Financial Aid Administrators (NASFAA) is a nonprofit membership organization that represents more than 20,000 financial aid professionals at nearly 3,000 colleges, universities, and career schools across the country. NASFAA member institutions serve nine out of every 10 undergraduates in the United States. Based in Washington, D.C., NASFAA is the only national association with a primary focus on student aid legislation, regulatory analysis, and training for financial aid administrators. For more information, visit http://www.nasfaa.org.