“Pomp and Circumstance” swells as the sounds of rustling gowns and shuffling feet fill the air. The whole audience waits in eager anticipation with outstretched arms with cameras at the ready. Suddenly they appear, with tassels swaying on their paper-plate “mortar boards,” crossing the stage to receive their mini diplomas.
At the end of the ceremony, they are moving up to . . . kindergarten! Overwhelmed with pride, you think, “Wow, they are growing up so fast.” And then you realize, “Wow, they are growing up SO fast!”
Kids really do grow up in the blink of an eye. That’s one of the many reasons the 529 college-savings industry introduced 529 Day during the month of graduation celebrations, whether it’s from preschool, middle school, or high school. 529 Day (May 29) highlights the importance of saving now for your child’s future college education in a 529 college savings plan, whether the future is 18 years away or three months from now. By starting early, a college savings fund can grow with them. It’s easy, too, with Ohio’s 529 plan, CollegeAdvantage.
Let’s start at the beginning: What’s a 529 plan? A 529 plan is a college saving account, named after the part of the Internal Revenue Code that authorized their creation in 1996, Section 529. Legally know as a “qualified tuition plan,” these college savings accounts are sponsored by states, state agencies, or educational institutions. Ohio Tuition Trust Authority is the state agency that administers Ohio’s 529 Plan, CollegeAdvantage.
529 plans encourages families to save for college with the benefits of tax-free earnings and tax-free withdrawals when used for qualified higher education expenses. Ohio taxpayers can also deduct up to $2,000 in contributions per beneficiary, per year from their Ohio taxable income. For families with young children, 529 college savings plans are a great way to start early and save over time in a tax-advantaged way while taking advantage of the power of compound interest. Even with older children, it’s never too late to save in a 529 account to maximize the tax benefits.
CollegeAdvantage offers tools and calculators to help build a 529 savings plan to best fits a family’s needs. Use the tools to set or rework a college savings goal, check long-term tax benefits of saving in a 529 plan compared to the taxable savings account, or even see the cost of waiting to save. Ohio’s 529 Plan provides ready-made, age-based portfolios as well as ready-made, risk-based portfolios to tailor a 529 college savings plan to the individual needs of the beneficiary.
Saving for college in Ohio’s 529 Plan does not mean that those funds can only be used in Ohio. 529 plans can be used nationwide (and even overseas) at any accredited two-year, four-year, graduate or professional, or any other post-secondary schools that accepts federal financial aid.
In honor of 529 Day and the graduation season, CollegeAdvantage, Ohio’s 529 plan, wants to help account owners reach their college savings goals by giving away five $529 CollegeAdvantage College Savings Awards. Click here to enter. Entries will be accepted through 11:59 p.m. EST on June 11.
Interested in opening an Ohio 529 college savings plan? Visit CollegeAdvantage online to start saving for future college expenses today. For a good overview about 529 plans, visit SavingForCollege.com for a quick video.