Life, Adventure, Family, Writing what else is there? Random thoughts. |
I wanted to get the word out on this since I just found out about it recently. Mind you, I’m not an economic genius. I know the basics. I have a job to earn money and pay the bills. I can balance a checkbook. Occasionally, I play the lotto hoping for a couple extra bucks. Saving is rough because I live paycheck-to-paycheck. I don’t have a strong economic background, but I know this basic fact: To make money, you need to grow money. I have two boys I need to help through college. Thankfully, one of my co-workers told me about a 529 savings plan. It’s a way to grow money to help your son or daughter attend college. So what is it? An investment tool designed for saving for future higher educational expenses. Most plans are run though the state. You can find California’s at: scholarshare.com T. Rowe Price is out of Alaska. That’s the plan I went with. Overview: Most growth comes from investment in mutual funds. 529 plans are administered by states only, though record keeping can be through a mutual fund company. Use it for: tuition, fees, books, supplies for college, room and board. Advantages: principal grows tax deferred; distributions for beneficiary’s college cost tax free; depending on the state, provides state income tax deductions. Donor controls the account. Family members can make gifts to the account. T. Rowe Price: For me, it offered me “easy.” It was simple to understand the website. I didn’t feel overwhelmed. I felt confident my son could choose a college anywhere in the U.S. I felt confident picking his investment portfolio in that I felt it would grow the investment. I could afford the 250.00 initial investment and 50.00 a paycheck auto deposit. When I went to sign up, again, it was easy. Just a couple of screens and I was good. I’m happy I sighed up. It’s a good start to 2015. |