5 Ways To Grow a 529 Account
Despite getting a bit soggy (hello, random fall downpour!), Vi and I were delighted to spend time at the U.Fund Dreams Tour tent at Assembly Row’s Riverfest this past Saturday. The U.Fund Dreams Tour offers an opportunity for parents to learn about 529 educational savings plans in a cheerful, totally not intimidating setting while kids can have fun thinking about what they want to be when they grow up (there are career-related games and activities throughout the tent). There are a half dozen stops remaining on the tour through the end of the year (see schedule below); toss a stop on your calendar!
A few weeks ago I crowdsourced for questions about 529s and was thrilled to get a series of questions answered in this wonderfully informative post on 7 things to know about 529 educational savings plans (huge thanks to Director of College Planning at MEFA Julie Shields-Rutyna!). But one of the things that stuck with me was how several people shared that they know they should start an account, but it just feels daunting—they just don’t see how they can shave off any money from their day to day expenses to put into a 529 account. So today I want to share some ways to grow a 529 account—some from personal experience and some that I learned during our visit to the U.Fund tent this past weekend. And if you need information on how to set up a 529 account, head to MEFA’s U.Fund 529 college savings page.
1. Set up monthly payments
Obviously, the most steady way to grow a 529 savings account is to sit down with your budget, calculate a monthly savings goal, and set up monthly payments into the 529 account. That said, I totally get that this can be challenging for many families for a variety of reasons, so following are ideas for growth at less-regular intervals!
2. Ask for 529 contributions at holidays and birthdays
Hands down, one of the easiest opportunities to grow a 529 account is when family or friends ask about birthday or holiday gifts for your kids. Let me tell you: it is 100% NOT WEIRD to ask for a 529 contribution, especially if your kid already has plenty of material things! Once you have an account set up, you will receive a share link for your child’s page, which you can send to people. I have a Google doc where I keep the URLs for Laurel and Violet’s 529 contribution pages handy, as well as those of their three cousins. During the holidays, when the kids are receiving all manner of things from many different directions, I opt to give my nieces and nephew a small token gift (seriously, never underestimate the power of a chocolate bar) + a contribution to their 529. Clutter-free gift that supports a kid’s future = major double win!
3. Earn 529 credit card rewards
I recently learned from a friend that her family has built up their 529 savings considerably by depositing rewards from their credit card into their 529 accounts. So smart!
4. Make a substantial end-of-year contribution
Given that Jon and I are both independent business owners, we tend to take care of all the financial things at tax time. This past spring, after we were squared up on taxes and retirement investment, we deposited substantial contributions into Laurel and Violet’s 529 accounts. Though monthly payments obviously make sense, given the way we operate, this is actually an easier way for us to handle our 529 contributions.
5. Get your kids involved
I’m a big believer in getting kids involved. My girls know that I needed to pay my own way through college starting sophomore year and that it was extraordinarily stressful. They also know that I do not want them to experience that level of stress, but that I expect them to be part of the equation with us. Now that Laurel has a job she routinely splits her paychecks into regular savings and her college account, which is so fantastic. I also think that a lemonade stand to raise 529 contributions would be super cute for younger kids!
Disclosure: This post reflects a compensated editorial partnership with Fidelity/MEFA. All opinions about the importance of putting money into 529s are, of course, my own. To learn more about the 529 college savings account, visit MEFA.org.
Link to MEFA.org. Also, team just an FYI, I cropped the wide margin on the left a bit so that the content in the graphic would show up better on mobile