Countdown to 529 Day: Maximize your college savings with Future Scholar
Any day is a great day to save for college, but May 29th may just be the best of all. Why? Because it’s 5-2-9 Day!
As South Carolina’s 529 college savings plan, Future Scholar is making it easy for families to save—and providing all the information you need to make the best saving decisions.
That’s why as we countdown to National 529 Day, we want to answer some important questions you may have about saving for college with a 529 plan:
#1: How is a 529 plan different from a savings account?
It all starts with the name: 529 plans were created under section 529 of the Internal Revenue Code. Why is this exciting for you? Because 529 investment accounts offer tax advantages that traditional savings accounts can’t provide. For example, the money you save for college through Future Scholar can be deducted on your South Carolina state tax return. What’s more, any earnings you gain with your 529 savings aren’t taxed. And when the time comes, the withdrawals you use to pay for qualified educational expenses won’t be taxed either!
#2 Who can open a 529 account?
While it’s typical that parents open accounts for their children, any adult who’s a U.S. citizen can open a 529 account for themselves or for another person. Family and friends can even establish Future Scholar accounts for the same child, as long as the total contributions of all accounts opened for that child do not exceed the limit of $540,000 per beneficiary.
#3 How can savings be used?
There’s a lot of flexibility in how Future Scholar funds can be used. Savings can cover not only tuition but also other expenses such as any housing, meals, computers or books associated with pursuing college, technical school, apprenticeships, graduate school, or other higher education. Funds can be spent at schools across the U.S. and around the world. And you can even transfer money that isn’t used by one family member to another person in his or her family.
#4 How much do you have to save?
There’s no minimum amount you need to open an account and no requirement for saving. A family may want to start small and increase the amount they save when it fits their budget. Of course, starting early and saving regularly are the best ways to help you reach your saving goal and reduce the need for student loans. You can use our free tools to help you plan and budget.
#5 How do you get started?
Anyone can open an account in under an hour – online, any time. We’ve worked hard to make it easy for you. Our short checklist of the information you’ll need will make it a snap. Once you’ve set up your account, it will be simple to make any changes you choose online, too.
PalmettoBaby On Board: Know someone who’s expecting?
Have we mentioned that May 29th is our favorite day of the year? One way we like to celebrate is through our PalmettoBaby program.
This annual program awards every South Carolina baby born on May 29 a privately funded $529 grant when a parent opens a Future Scholar account. Our first PalmettoBabies will turn nine digits this year! As they’re celebrating a happy 9th birthday on 5/29/22, we will be welcoming our newest recipients at hospitals all around the state.
Think you may have a PalmettoBaby in the family? Find out all the details for participating here.
And be sure to celebrate National 529 Day on May 29 by opening or adding to your own Future Scholar account!