With college tuition rates rising faster
than inflation, saving for college can be daunting. Jump start the process with
a Utah Educational Savings Account, an IRS-approved 529 plan. “529 plans are a tax-advantaged savings to
encourage individuals to begin to save for the future costs of higher
education,” according to www.UESP.org. A 529 plan offers tax-free growth as
long as the funds are used for qualified higher education expenses including tuition
and fees, books, and room and board, as long as the student is enrolled at
least half-time.
Although
part of the federal tax code, 529 plans are state run, and vary greatly from
one state to another. Utah’s 529 plan is Gold-Rated by Morningstar (only three
other states share that rating) as well as high ratings from other sources.
Part of the reason, is the low expenses. On average, Utah’s 529 plan charges an
ultra-low expense ratio; averaging just 0.24%. It’s easy to start a 529 plan.
Simply go to UESP.org, enter information about yourself (as account owner), the
child you wish to start an account for, and how much you’d like to contribute.
There is no minimum amount needed to start and it only takes about 10 minutes
to get set up.
Utah’s
529 plan offers great investment choices. The four age-based options gradually
become more conservative as your child gets closer to entering college. You can
also choose from 8 static (unchanging) options or you can customize your
investments.
Adults can save for
their own education using 529 plans. In fact, you don’t have to live in the
state of Utah to start an account with UESP! State residents enjoy tax benefits
for their contributions. Grandparents, aunts and uncles can also start an
account or contribute towards Junior’s college fund. When it comes to opening a
529 plan, you don’t have to be the parent or the legal guardian to open or
contribute to the account.
Another
way to add to Junior’s account is with Utah’s Fast Forward Matching program. UESP
will match you dollar for dollar (minimum $100 annual contribution) up to $400
annually. That means if you qualify, and put $320 into your child’s 529 plan,
Utah will put an additional $320 into their account.* To qualify, the family’s
income must be below 200% of the federal poverty level. See the table below for
details:
|
Persons in Family or Household
(including parents)
|
Income Must Be Below
|
|
 |
2
|
$31,020
|
|
|
3
|
$39,060
|
|
|
4
|
$47,100
|
|
|
5
|
$55,140
|
|
|
6
|
$63,180
|
|
|
7
|
$71,220
|
|
|
8
|
$79,260
|
|
For
each additional person, add
|
$8,040
|
|
UESP.org
To take advantage of the Fast Forward
program contributors must be the parent or guardian of a child under age 17.
Check out UESP’s Fast Forward Matching program for more information.
Celebrate National 529 day (May 29th)
by setting up a 529 plan for you or a loved one!
* Utah’s Fast Forward matching program
for more details or call (800) 418-2551
No comments:
Post a Comment