I have big dreams for my children. I want them to grow up to be kind, cultured, and compassionate human beings. I also want them to follow career paths that align with their passions and make them successful to whatever their perception of success becomes. I also want them to be financially free so they’re not in my pockets forever.
When I think about what I want for my children, I also think about my career path and how I got here. Two degrees, a few horrible jobs, and several years later I have a career that I enjoy at an awesome company. In my field of work college isn’t an option but a must. I’m grateful for parents who ensured my education was covered so I could graduate debt free.
I want to be able to provide the same for my children– a debt free start. However, the uncertainty of current times also leaves a lot of uncertainty around higher education. One thing I think is safe to predict is that the cost will continue to rise over time, making it harder for families to fathom the possibility of sending their children to college without loans. Luckily, 529 college savings plans exist and Scholar Raise is here to help families save easily and effectively.
What is a 529 college savings plan?
A 529 college savings plan is an account designed to save money for future educational expenses. Think of it like a retirement account but for school. You contribute money over time and it acts like a mutual fund by investing in a diverse series of assets to earn interest and provide returns on your investment.
There are many benefits of a 529 college savings plan that make it a better option for education savings than a traditional savings account. One of my favorite benefits is that the government does not tax 529 college savings accounts if the money is used for qualified education expenses such as tuition, fees, textbooks, supplies and equipment required for the enrollment or attendance at an eligible educational institution. The return is much better than your average savings account with an average annual return of 6% whereas traditional savings accounts typically have an annual return of less than 1%. In addition, 529 college savings plans have the least impact on financial aid eligibility.
What is Scholar Raise?
Scholar Raise is a company that empowers families to save for college with the goal to minimize student debt. They make it easy to sign up for a state-run, government backed savings plan. Setting up a 529 plan can be difficult and some people even opt for using a financial advisor which can come with hefty fees. However, with Scholar Raise, you can set your plan up with just a few simple steps, no minimums, and no cost to the account owner.
What I Love About Scholar Raise
I am loving that Scholar Raise is an inclusive, community based platform that makes it easy for families to set up their 529 plans and contribute. Once your scholar profile is created, Scholar Raise provides you a unique URL to share with family & friends. We all know “it takes a village” and this is a way your village can contribute easily and securely without sharing your child’s personal information.
Something new I learned since discovering Scholar Raise is that you don’t have to open a plan in the state you live. Scholar Raise uses the New York state 529 plan which charges one of the lowest management fees in the country and gives great returns and tax advantages.
Since I already have a 529 based in NJ I wondered how I could make the switch. Of course, Scholar Raise has that covered! You can have multiple 529 plans just not in the same state. So opening an NY plan with Scholar Raise is my next move!
If for some reason one or both of my kids don’t use the 529 plan money I have options for that too. The money can be transferred to another qualifying family member without any tax consequences. The other option would be to withdraw the money and the only penalty would be on the gains, not what was deposited.
For My Readers
If you want to get started saving for your children’s future you can open a Scholar Raise account in just a few minutes. You don’t need a super large deposit, just your information, your child’s information, and then confirm the account! Get started today building a debt free future for your children!
Jasmine, the Founder and CEO of Money & Momming is based in New Jersey. Jasmine is wife, mom, and works full time as a supplier quality engineer in the aerospace industry.