February 14, 2021
My grown-up says that there's a lot to love about 529 plans. Mine is as old as I am! What do you love about 529s?
Gemma (age 2)
I love that your grown-ups love 529 as much as I do. Indeed, there is a lot to love about saving and planning for the future!
A 529 is a tax-advantaged way to save for future education.* That means you set aside the money now in a special account that grows tax-free (as your grown-up what that means), and earnings are tax-free as long as you use your account for education expenses like tuition, books, and even computers! This helps your savings turn into even more savings. And if you are contributing in a systematic way (that means saving on a regular basis), you can take advantage of your account's growth potential over time!
Maybe one day, your fascination with pets will turn into a career in veterinary medicine, or maybe you want to become something completely different when you grow up. You can do it all with help from a 529 plan.
Gemma, you're off to a great start and I admire that! Whatever you decide to do, the most important thing is to keep saving, keep dreaming big, and keep working toward your education goals!
Oh—and make sure your grown-ups check to make sure some of the new education expenses like apprenticeship programs are tax-advantaged in your state too!
Happy Valentine's Day from Alaska,
This material has been prepared for general and educational purposes only. This material does not provide investment, financial, legal, or tax advice. Please consult your tax or financial professional for details regarding your specific situation.