It’s America Saves Week (February 26 – March 3), an annual event co-sponsored by America Saves and the American Savings Education Council to promote good saving behaviors. This week is an ideal time for you to review your finances, set new savings goals, and set up a plan that will help you to save for what’s important to you.
If saving for education expenses is a priority, a 529 savings plan might be the right choice. Specifically designed for families to help save for future education expenses (and reduce reliance on student loans), these plans are administered by state agencies and organizations. The plans are free from federal income tax, and so are withdrawals when used for qualified education expenses, such as: tuition, computers, mandatory fees, books, supplies, certain room and board costs, and more.
529 savings plans are typically opened by parents and grandparents, but anyone who’d like to start saving for education expenses can open one. Anyone—grandparents, uncles, aunts, family friends, and more—can contribute to someone’s 529 plan and services like Upromise and Ugift make it easy to support someone’s future education needs.
For Indiana University families interested in saving for education, the IU Office of Financial Literacy has launched a new resource: 529.iu.edu. This resource makes it easier to start saving by guiding you through some of the most common saving options available, and breaking down the process of choosing the right plan(s) for your needs. Different college savings plans are compared, including 529 plans such as Indiana’s CollegeChoice. The Financial Literacy team has pulled together research and resources to help you understand the pros and cons of each plan and make the best choice for your needs.
Once you’ve enrolled in a plan, it’s easy to set up a direct deposit from your paycheck right to your savings plan through IU Payroll. Learn how with this step-by-step flyer (PDF).
529 plans are designed to help families set aside funds for future education costs. Here are some reasons why they’re a popular savings option:
Visit 529.iu.edu to learn more about college savings plans.
Page updated: February 2018
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