Make May 29 Your Day to Save for College

Girl and two boys in graduation cap and gown

What are you doing on May 29? With a nod to 529 college savings plans, Edward Jones is marking May 29 as “Save for Education Day” – a reminder to get serious about achieving your education savings goals.

Whether a private or public school is in your child’s or grandchild’s future, education costs are rising – in fact, even outpacing inflation. By opening a 529 plan today and then contributing consistently, you can build a college fund to help cover these costs. The following illustrates how waiting even three years can impact your goal.

Cost of Waiting chart

This chart is for illustrative purposes only, does not represent any particular investment, and does not include transaction fees or taxes. These estimates assume a contribution of $200/month and a 7% average annualized rate of return compounded monthly.

How can a 529 plan help me?

A 529 plan offers: 

  • Tax advantages – Withdrawals are federally tax free when used for qualified higher education expenses such as tuition, room and board, books and more.
  • Flexibility – Withdrawals can be used for qualified expenses at any eligible college or university in any state and even some schools abroad.
  • Control – As the account owner, you retain control over the account and can ensure that the proceeds are used as intended.
  • Gift opportunities – Family and friends who are looking for a unique gift idea can contribute to the plan.

There are tax and withdrawal considerations with 529 plans, so be sure to discuss these with your financial advisor.

Important information:

Withdrawals used for expenses other than qualified education expenditures may be subject to federal and state taxes, plus a 10% penalty on the earnings. Contributions may be eligible for a state tax deduction or credit in certain states for residents who participate in their own state’s plan. 529 college savings plans may reduce a beneficiary’s ability to qualify for financial aid. Please consult with your tax advisor regarding the tax implications of 529 college savings plans.

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