Reevaluate Your College Savings Strategy this Summer
Summer is a time for part-time jobs, summer school, ball games and barbecues. Between the constant rush of activities and sun-drenched vacations, learn how easy it is to prepare for your child’s higher education with Iowa’s 529 plan, College Savings Iowa.
While your young ones are testing their business acumen at a driveway lemonade stand, and your teens are putting those early lessons into practice at their first job, use these tips to plan for what tomorrow may bring.
- “Set it and forget it” with an automatic investment plan (AIP). Saving with AIP allows you to set up automatic contributions on a regular basis by connecting your financial institution and College Savings Iowa accounts. By making saving a part of your routine, you won’t need to set aside time to contribute. If you already use AIP, consider increasing the amount you contribute. Even a few more dollars a month could mean big savings when it comes time to write that first check. You and your kids may be taking a break this summer, but your accounts will not!
- Use the College Savings Plans Network college cost calculator to ensure you are still on track to meet your savings goals. The calculator allows you to select the student’s current age, the type of school they are interested in attending and the college cost inflation rate (the average national tuition inflation has been between 6-7 percent). With this tool, it’s easy to reevaluate your saving strategy. Remember, whatever you’re able to save in a 529 today is one less dollar you have to borrow tomorrow!
- Revisit how your money is currently invested. Are you taking advantage of an age-based option or relying on individual portfolios? If you are using a combination of investments, make sure they are working to your benefit. Remember, you can exchange your money from one option to another – IRS regulations allow you to make two exchanges per year – or direct your new contributions into a new portfolio.
- Help us spread the word! When you are getting together with friends and family this summer, be sure to mention the benefits of College Savings Iowa – from a state tax deduction to minimal initial investments and a low annual fee. Encourage them to open an account for their own children or to give holiday and birthday contributions through Ugift®. Each child can have his or her own dedicated college savings account!
By investing in your children’s education, you are investing in their future. I encourage you to make time and evaluate your college savings strategies, because just like this summer, the time to save for those expenses will be over before you know it!
By: Michael L. Fitzgerald, Treasurer of State
Investment returns are not guaranteed and you could lose money by investing in the plan. Participants assume all investment risks as well as responsibility for any federal and state tax consequences. If you are not an Iowa taxpayer, consider before investing whether your or the designated beneficiary’s home state offers any state tax or other benefits that are only available for investments in such state’s qualified tuition program.
For more information about the College Savings Iowa 529 Plan, call 888-672-9116 or visit CollegeSavingsIowa.com to obtain a Program Description. Investment objectives, risks, charges, expenses and other important information are included in the Program Description; read and consider it carefully before investing.
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