College Savings: The Holiday Gift That Lasts a Lifetime
Written by: Randall Welsh
The holiday season is upon us. A time for laughter, cheer, spending quality time with the ones you love, chestnuts roasting on an open fire, caroling on a clear, crisp night, you get the idea.
It’s also the time of year when parents, grandparents, aunts and uncles scramble through department stores, searching for the perfect holiday gift (or twenty) for all of the important children in their lives.
Don’t get me wrong--- holiday shopping is fun. Plus, it gives you the chance to really think about your loved ones. Who they are, what they like, what they want, you know… what would truly make them happy.
While I’d never try to tell a child that gifts aren’t important, (I certainly plan on buying a toy or two for my daughter this season), I do believe that sometimes, the best, most thoughtful and most meaningful gifts are the ones that can’t be wrapped.
Throughout my experience working on Bright Start College Savings, I’ve learned that the gift of education is something that can never truly be quantified. Opening a 529 college savings account for a loved one is a way of telling him or her, “I believe you will go to college someday, and I will do whatever I can to support your dreams.” While there are countless reasons to open an account, here are my top three.
1. There are tax benefits! Your Bright Start earnings grow federal tax-free. That means you don’t pay taxes on investment earnings, and, if you live in Illinois, contributions to your account are tax deductible—up to $10,000 per parent, per year ($20,000 if married and filing jointly)—and you pay no state tax on earnings and withdrawals that cover qualified college expenses. And speaking of tax benefits, if you’d like to claim a deduction on your 2014 state income taxes, just be sure to open an account and make a contribution by the December 31st deadline.
2. It’s just so easy. Bright Start is a Section 529 education savings program created and administered by the state of Illinois. It allows you to save money toward your future student's education in a Bright Start account and pay no taxes on any earnings. And, it’s so easy to start. You can open a 529 account in only 15 minutes, with a minimum contribution of $25.
3. Today’s a good day to save, no matter what age your children are. One of the reasons a 529 college savings plan is right for everyone is that it’s literally never too early or too late to start saving for college. Parents, grandparents, aunts, uncles, babysitters, basically anyone can open accounts for all of the babies, toddlers and young adults in their lives.
Those gift-giving days are right around the corner, and soon wrapping paper will be flying around your living room faster than you can say “four AAA batteries.” Bright Start is here to help make sure there’s at least one thing under the tree that will truly last a lifetime. You can learn more about Bright Start’s 529 college savings plan at BrightStartSavings.comPosted on November 13, 2014 at 6:59 AM