Benefits of Automating 529 Contributions
Genius physicist Albert Einstein called compound interest “the eighth wonder of the world,” and it is a pretty amazing concept. (He was a genius, after all). With compound interest, not only is your principal invested, but any earnings are also invested and continue to be, over and over.
As a college savings investor, you can make compounding work for you, too. The exciting exponential growth offered by compounding is maximized by time and investing regularly. Starting early and making steady contributions to your Future Scholar 529 College Savings Plan will help you reap the benefits of “the eighth wonder of the world.”
Just as they do in a 401(k) retirement account, automated contributions to a 529 account – as opposed to manually submitted contributions – help you stick with your investment plan longer to obtain better results.
Here’s how automating your 529 plan contributions benefits you:
- Gives you one less thing to remember. Life is busy. And if you’re like most people, investing can get pushed to the back burner while you deal with the day-to-day routine - getting dinner on the table, carpooling kids, answering work emails. Automating contributions ensures you won’t forget to fund your 529 plan.
- Allows you to pay yourself. By automating your contributions, you make sure you pay yourself to help you cover the cost of your child’s future education. Someday – sooner than you think – you’ll be glad you did.
- Saves you time. Automatic contributions mean you don't have to log in to your 529 account every month and submit a new payment. So, over the months and years you’re contributing to college savings, you’ll be receiving significant time-savings, too!
- Helps you stay on course. When you set up automatic contributions, you're basically putting guardrails in place that help you stay on a savings course. In order to go beyond these guardrails, you have to physically go in and remove them. By staying on course with your contributions, you remain on the right path to achieving your savings goal.
It’s clear setting up recurring payments with automated contributions from your bank account will help you optimize your time and investment. We’re proud to offer three distinct ways for you to invest within the Future Scholar Direct Plan: the Age Based Option, the Target Allocation Option, and the Single-Fund Option.
Set up automatic contributions and get the “eighth wonder” working for you today. Who’s the genius now?