May 29 (5/29) is 529 College Savings Day to raise awareness to the fact that saving for college is an important step families can do for their children.
A 529 Savings Plan offers considerable benefits for the participants such as tax-deferred earnings, tax-free distributions for qualified educational expenses, and possibly state income tax deductions on contributions, depending upon your state of residency. Setting up a 529 plan is quick and easy. Most plans allow you to complete the enrollment form online in less than five minutes. You may set up electronic transfer with your bank account for automatic contributions or manually initiate them at specific times during the year. The investment funds available tend to be pre-packaged risk or age-based model portfolios. The tax advantages of 529 Plan accounts do not phase out for people with higher income levels like many other savings vehicles. The one major disadvantage of the 529 Plan account is the potential tax and 10% penalty on earnings withdrawn for non-qualifying college expenses. Participants can open a College Savings Iowa account with as little as $25 and save for anyone. You can save for your children, grandchildren, friends, or even for yourself!
Celebrate 529 day by taking advantage of the tutorial offered by College Savings Iowa where you can learn how convenient it is to save for the future. As a way to raise awareness about 529 plans, anyone who completes the tutorial is automatically registered for the chance to win a $1,000 College Savings Iowa account. Visit Iowa529InFocus.com before May 31 to access the tutorial and see official rules.