If you’re stuck on what go to give a youngster for the holidays, one suggestion is money for college. A 2021 survey showed forty five percent of parents asked for donations for their son or daughter’s college education instead of gifts. The State of Alabama offers what’s known as a 529 plan where money can be invested for school. Martha Kortiak Mert is CEO of the website Saving for College Dot Com. She says once parents sign up, friends and family be asked to give…
“Get set up for that, and then you can send out email invitations to say grandparents, aunts and uncles,” she said. “Pretty much anyone who you're expecting you know is going to be giving a gift, whether it's for the holiday birthdays or, you know, any other types of milestones or gift giving occasions.
term “529” refers to section 529 of the Internal Revenue Service code for investments for higher education. The website CollegeCounts529 says Alabama families can donate up to $10,000 to a college fund for a couple each filing $5,000. Or a single donor can invest $5,000. The website says either way can be deducted from State income taxes. CollegeCounts529 adds that money from a 529 can also be used for expenses beyond tuition including books, supplies, some of the costs for room and board as well as computer equipment and software. Martha Kortiak Mert of the website Saving for College Dot Com says the system includes a link that can be sent to family and friends for donations instead of holiday gifts…
"About 35% of people in our survey said that if they had a link to give out to people, that would make it easier," she said. "So that's one way, you know, especially if you're putting together a wish list for those gift givers, you can include that link. And, you know, with those you can usually personalize, maybe include a picture of your child on that, on that account, etc."
Proponents of the 529 plan say it can also act an early lesson for youngsters on how financial planning works. Money in the account can also reportedly be used for schools outside of Alabama.
