Whether your children are in grade school or high school, they’ll be leaving for college or trade school before you know it. With the cost of education rising, now is the time to prepare for that day.
Starting to invest when your child is born is often a great way to build a strong financial future. Even if your children are older, you can still make progress and potentially reap tax benefits by contributing to a 529 education savings plan. Contributions are made with after-tax dollars, accumulate with no federal income tax and can be withdrawn for qualified education expenses federally tax free.
Unfortunately, half of Americans don’t know what a 529 plan is, and fewer than a quarter have one, according to 2024 research from Edward Jones and Morning Consult. One way to keep a 529 plan top of mind is to recognize May 29 (5/29) as Save for Education Day.
Benefits of a 529 plan
Strategies for building 529 savings
If you set aside money every month, it can make a big difference toward funding your child's best educational path forward. So, how can you budget for a 529 for your child, when you have competing financial priorities?
Your financial advisor can help you determine how a 529 plan can fit into your overall financial strategy and navigate the various guidelines and limits – such as defining a qualified expense, changing beneficiaries and rolling unused dollars elsewhere.
A 529 plan can be a valuable tool for helping your family members afford the educational opportunities that can lead to a promising future. Whether you're exploring this opportunity for the first time or reviewing your current plan, Save for Education Day on 5/29 is good time to do it.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor. Edward Jones, Member SIPC