Improve Financial Wellness with Automatic 529 Contributions

What is Financial Wellness?

Financial wellness means something different to everyone. But for most people, it includes:

• Being able to comfortably manage all bills and financial obligations
• Having enough money to put toward your future expenses, like college or retirement
• Having a full understanding of your finances so you can move money around when needed
• Being able to absorb a financial shock, like an unexpected car repair or medical bill

Thankfully, there are many ways to improve financial wellness for yourself and your family that go beyond simply trying to have enough money or making more money. You can also make smart choices with the money you already have. Let’s take a closer look. 

How Does Saving and Investing Contribute to Financial Well-Being?

Saving money is one of the strongest ways to improve overall financial wellness – whether that means tucking it into a traditional savings account or investing it in an instrument such as a 529 college savings account.

Why? Having a nest egg of savings can improve peace of mind and give you the confidence to handle unexpected financial hiccups or road bumps in the future. Investing money in the right accounts and programs will help you grow those savings.

True financial wellness means taking steps to ensure that you and your loved ones have enough money for today’s needs and needs that will arise in the years to come!

Financial Wellness Check: What Should You Do?

The ability to pay for everyday expenses while saving for the future is key to achieving financial wellness – and a greater peace of mind. That’s especially true if you’re a parent or grandparent with dependents. You’re sure to list having money to help pay for your child or grandchild’s future college, apprenticeship, or other type of education as one of your top priorities.

To pursue financial goals like funding future education, it’s a good idea to do regular financial wellness checks for yourself and your family. Start by tracking your monthly expenses to identify places where you can pull a little extra money to stash away. Then, take advantage of investment tools, such as a 529 plan, which can help that money grow.

Saving for School Through 529 Plan Contributions

Through specialized 529 investment accounts, you can save for future education expenses, such as college tuition, registered apprenticeship programs, and more. 529 plans are highly effective investment tools to help you reach your long-term education savings goals. They can greatly boost the growth potential of your savings dollars to make saving for a future education easier, and beneficiaries can withdraw the money from a 529 account without paying any taxes as long as they use the funds for qualified education expenses.

That’s why setting up and contributing to a 529 account for a child in your family is a smart step toward achieving financial wellness.

And that’s not all! When you contribute to a Future Scholar 529 plan, you can deduct 100% of those contributions from your South Carolina state income taxes. A lower tax burden is always a good thing, making 529 plans one of the most potent financial wellness tools at your disposal.

Improve Financial Wellness by Making Automatic 529 Contributions

You can take your journey toward financial wellness one step further by using one of the best financial tricks to help you save: automatic 529 account contributions.

We’d all like to believe we’ll remember to put some cash into our 529 plans each month. But for most of us, the reality is that life gets busy, and even the important things can – and do – slip our minds. Since the growth potential of funds in a 529 plan increases with each contribution, you’ll want to avoid accidentally missing a contribution, even if it’s only once in a while.

The solution? Set up automatic contributions to your 529 account the way you make automatic bill payments. By “setting and forgetting” your 529 account contributions, you'll ensure they occur on a regular schedule and that the total funds in the account continue to accumulate until the beneficiary needs them.

How to Set Up Automatic 529 Plan Contributions

Good news: beginning automatic contributions to a 529 plan is quick and simple. Once you have a Future Scholar account, all you need to do is log in, navigate to transactions, and set up automatic contributions. Then, select where the money comes from, such as your checking account. You can choose the amount you wish to contribute, and you can pick the frequency of contributions – weekly, monthly, or quarterly.

Depending on your employer, you may be able to set up direct deposit to your 529 account. Similar to automatic retirement account contributions, this method diverts a small portion of your paycheck into your 529 account each month while the rest goes to your normal checking or savings accounts.

Why Set Up Automatic 529 Plan Contributions?

Automatic 529 plan deposits are an easy way to help improve your financial wellness. First, they’ll prevent you from having to think about yet another monthly payment, which helps to reduce financial stress. It’s the same reason setting up automatic utility bill payments or retirement account payments is ideal.

Second, automatically contributing to a 529 plan will prevent you from forgetting to make contributions. Since each 529 payment increases the total funds in the account through successive investments, the sooner your contributions enter the account, the more opportunity your funds have to grow.

529 plan contributions also provide financial wellness for a child, grandchild or other child in your family because they directly and tangibly improve the financial situation of the beneficiary. This amazing gift is so much more than just helping pay for education expenses. It’s helping a loved one achieve their dreams without worrying about how they’ll pay to reach those long-term goals.

Start Improving Financial Wellness with Future Scholar Today

There are many ways to practice financial wellness for yourself and the people you love. With Future Scholar, you can achieve an important one: saving for education. And when you set up automatic contributions to your Future Scholar account, you make working toward your future education savings goals even easier. More importantly, your regular contributions can give a child’s financial wellness a great start. Open a 529 account today if you haven’t done so. And if you already have a 529 plan, go ahead and set up automatic contributions to maximize your savings for your loved ones’ future dreams.