529 Plans: Graduating Your Kids Debt-Free

529 pin

Yesterday, I attended an event at the home of P. Allen Smith; Moss Mountain Farm.  It was super duper awesome.  While I could spend this post talking all about how lovely his farm is, how perfect the interior design of his home is or what an amazing artist he is, today I want to focus on something different for this post (Other deets will be featured in a coming post though, don’t you worry).  I want to talk you about why he chose to invite all of us Arkansas Women Bloggers to his farm.  The Arkansas 529 plan for college savings.

Today is College Savings Day.  It’s 5/29 & we need to talk about 529s.  Ever heard of them?  529 refers to Section 529 of the Internal Revenue Code. All 50 states have at least one type.  It is a savings tool for parents, grandparents, anyone to help prepare to fund college tuition & help your loved ones graduate from college debt-free.  It’s a federally authorized, tax-deferred investment.  Tax-deferred means that your earnings from this investment are tax-free until you withdraw the funds.

When I went to college I relied fully on financial aid.  A large part of that included student loans which I carried with me until just recently (I graduated in 2000 y’all).  You can do better for your child.  How do I know you can?  529 plans can be opened with a very small investement of as little as $25!  After this initial $25 you can set up a monthly payment by electronic draft, by a direct deposit through your employer or you can send in a check for whatever amount you feel comfortable with.  Over & above whatever you decide to contribute monthly, you can throw in whatever else; as you’re able.

What’s exciting is, you put in what you can afford & then, unlike a traditional savings account, you get to watch it grow each year.  It is truly amazing how a little bit of money can grow into a huge investment for your child’s future.  We set up investments for both of our children.

If you are having trouble figuring how to make room in your budget for this, let me make a couple of suggestions that won’t hurt too much:

1)  Put down the drive-thru Starbucks & buy bags for home.  Much cheaper.

2)  Turn off cable & use Hulu, Netflix, Amazon Prime, Google Play etc.

3)  Shop at Aldis for your groceries.  For real y’all.  It’s so cheap.

4)  Shop 2nd hand for things.  Most of my clothes (mine & my family’s) & just things in general are 2nd hand.  My furniture is from Craigslist, my clothes (a lot of them) are from thrift stores, yard sales, consignment, Ebay etc.  No lie.  Saving me TONS.

5)  Lastly, instead of loading up the kids with 18 presents every holiday.  Consider getting less presents & putting more into their 529 for college.  You’ll also be setting a good example for them.  You set the standard in your home & that will pass onto their family as well.  If they’re old enough, you can even show them their account & let them see how much money is accruing toward their college education.

Here are some the to get you started:

GIFT College Investing Plan

 

 

 

 

 

About Jacqueline Presley

Owner/Author Creative Outpour. Member of Arkansas Women Bloggers & Northwest Arkansas Bloggers. Jacqueline lives in Springdale, AR with her husband Spencer & her two children Katie (9) & Jackson (7).

Comments

  1. Like you, I relied fully on financial aid. My parents are wonderful, but I wish I’d had less gifts and less fancy dinners out on vacations… but instead a college fund. This is a wonderful resource for parents and I really respect you for making these sacrifices so your kids won’t have the burden we did.

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