Saving for multiple beneficiaries –tips & tricks
Whether you're saving for one child or six, use these saving strategies to help you save for future education expenses.
Start Early. When you’re managing a budget for a growing family, saving for the cost of future education can be daunting. Let time work on your side by setting aside as much as you can while your children are young. Starting early allows you to make modest contributions that may benefit from compounding interest or market growth over time.
Did you know that you can save for multiple beneficiaries in one account? However, opening an account for each beneficiary allows you to select the investment option based on your children’s ages and when they might start taking withdrawals to pay for qualified education expenses.
Make a Plan. Setting an education savings goal can help you stay on target and on track. To make a plan, use our College Financing Planner to estimate what your future college expenses might be at your dream college or university. The number you see may feel unattainable, but saving early, often, and strategically can be a great way to reach your goal.
Save Systematically. Whether you set up recurring contributions from a bank or payroll direct deposit, saving systematically is an automated way to build your savings quickly. Consider directly depositing $150 per pay period into your 529 account. After 26 pay periods in a calendar year, you would have nearly $4,000 in contributions to your 529 account.
Adjust as Needed. At least once a year, take a moment to review your contributions, your investment growth, and the needs of your family, and adjust your recurring contributions. Take the opportunity on 529 day (May 29th) or during college savings month to boost your contributions. It’s often said that when your child reaches their next milestone (out of diapers, out of daycare, etc.), it’s a good time to increase the contribution amount. Whatever works best for your family, be sure to assess and adjust.
Don’t forget to take advantage of Alaska 529’s Dash to Save More® incentive program. Sign up for recurring contributions and/or direct deposit and you could receive a $100 contribution.
Why this Matters: Funding post-secondary education can seem far away when your children are still in diapers, but 18 years can fly by. Making a plan and sticking to it can accelerate your education savings and relieve the financial burden of post-secondary education when the time comes, especially when you are saving for more than one beneficiary.
About the author: Lael M. Oldmixon, M.Ed. is the Executive Director of the Education Trust of Alaska.
Dash to Save More is a trademark of the Education Trust of Alaska.
