Alternative gifts: university savings account
SAN FRANCISCO (KRON) – When kids wake up on Christmas morning, they want to see toys under the tree and treats in their stockings.
But if you’re looking to make a more meaningful impact on your nieces and nephews, perhaps your grandchildren, now is the time to think outside the box.
One type of gift that might not be as fun now but will make a huge difference later: a gift to cover school fees.
Patricia Roberts is the author of âRoute 529: A Parents Guide to Saving for College and Vocational Training with 529 Plansâ and a mother who successfully got her son to college debt free.
Roberts is a leading expert in helping families avoid or minimize student loan debt.
Roberts says that because college and other forms of post-secondary education are expensive, a giveaway to a 529 college savings account is easy, and even small amounts of money can add up.
When you think about giving a gift for the holidays, traditional gifts like toys and clothing often get too big and their value is quickly overwhelmed, while an investment in a child’s future can increase in value.
A 529 college savings account is a special type of savings / investment account named after Section 529 of the Internal Revenue Code.
It grows tax free and the CA scheme is one of the most popular.
It’s called Scholarshare and can be used for many forms of post-high school education (two-year, four-year colleges and universities, business and technical schools, graduate and vocational studies across the United States and even across the United States. the world).
The money inside the account can cover tuition, fees, room and board, books, supplies, and even computers.
There are three ways to give a gift for higher education:
1. Open their own account.
With 15 minutes and $ 25, donors can open their own $ 529 college savings account for a child they care about and create a tradition of giving for birthdays, holidays, and other special occasions. You don’t need to be a parent or even related to the child you’re opening the account for. Any adult can open an account for any beneficiary.
2. Contribute to an established account. Offer to contribute to an account that the parents of a child have already set up.
Most of the 529 education savings plans have easy-to-use tools that make it easy for account holders to invite friends and family to contribute to already established accounts. By sharing a simple contribution barcode, loved ones can contribute to a child’s college account – rather than spending a lot of time, money, and effort searching for the âright giftâ.
3. Buy a gift card that can be used in most college savings accounts.
For gift givers who don’t want to spoil the surprise of a college giveaway, unique gift cards (available in retail stores and online) can be offered and can be used as an initial contribution on a new one. account. or subsequent contribution to an account already opened.