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The Importance of Saving for College Early

 

Parents and Grandparents – thinking about helping your child or grandchild save for future education expenses? Looking for a gift idea that they won’t outgrow, break, or lose interest in? Perhaps a 529 Plan would fit them just right. 
One way to get the highest value from a 529 plan is to open an account as soon as the child (or intended beneficiary) has a social security number. But why? The chart below illustrates the value of saving early. Here you can see the growth of a hypothetical account, initially funded with $250 and then each month receiving an additional $10. There is a noticeable difference in results. 

For Indiana residents perhaps the best option is a CollegeChoice 529 Direct Savings Plan, a low-cost option designed to allow you to do it yourself. Their website collegechoicedirect.com  answers questions you might have, along with providing a list of benefits. The list below highlights a few of the benefits: 

  • You can set it up yourself in just a few minutes (10 minutes or less) on the website. 
  • The funds remain in your name as the owner of the account, with the opportunity to change the beneficiary should circumstances change. 
  • Indiana taxpayers can get a state income tax credit equal to 20% of their contributions, up to $1,500 per year currently. 
  • Earnings grow tax deferred from federal and state taxes. If you withdraw the funds for qualified taxes, the withdrawals (including any earnings) are exempt from tax. 
The list of benefits goes on and on. The ease of opening the account, the tax break, and the tax-free accumulation of funds for education make this one of the best options out there today. 
Interested? Please head to the website today and take a look at the FAQs. You (and your child or grandchild) will be very glad that you did!

Investment and insurance products are:
*Not FDIC insured
*Not insured by any federal government agency
*Not a deposit or other obligation of, or guaranteed by, Centier Bank
*Subject to investment risks, including possible loss of the principal amount invested