If there’s one bill I wished I could just pay off for once and for all, it’s my student loan. Back in 1991 when I applied for my first loan, I really had no idea what I was getting myself into, but it was really my only option at the time because my parents hadn’t really saved or set aside any funds specifically for college.
Now that my girl has finally started Kindergarten, I’m actually starting to feel guilty that my husband and I haven’t opened a college fund for her yet and repeat the pattern. I’ve always been of the thought that I need to have my nest egg taken care of first because there are no loans for retirement, but that hasn’t really taken off either. So, I keep going back to wanting to learn more about our options for college savings.
Luckily, a couple of weeks ago I was invited to have dinner with some folks from ScholarShare, California’s 529 college savings plan, and I learned so much that I was motivated to finally open Camila a college fund using the payment she received from her appearance on the Disney Junior Hispanic Heritage Spots. We’ll start out by putting her first official paycheck to great use now, during the official College Savings Month
What I learned from ScholarShare is that there’s really not much of a loss scenario when you invest in your child’s future. It has been documented that children who know they have a college savings plan to their name are most likely to attend college, and that alone pushed me over the edge to start saving right away since all anyone really needs is $25 to open a ScholarShare account. I am definitely amongst the 93% of Latinos who believe, according to a survey conducted by Hart Research Associates, that it’s “very important” that my girl attend college, so I definitely must start planning now.
ScholarShare left it very clear that the only beneficiaries for the money are those we assign and it can only be withdrawn with no tax payments if it’s related to college or qualified higher education expenses. If my girl decides she doesn’t want to go to college, then that money can be withdrawn by me for any use, but with income tax payments. In any case, I still regain control of who the funds are spent, since it’s not like she’ll be able to withdraw for anything other than education-related expenses.
If you’re curious to learn more info on 529 plans in general and ScholarShare in specific:
Named for the section of the IRS code under which they were created, 529 plans are highly regarded for their tax-advantaged status. Earnings on investments grow tax-deferred, and disbursements, when used for tuition and other qualified higher education expenses, are federal and state tax-free. ScholarShare accounts may be opened with as little as $25, or $15 when combined with regular, automatic monthly contributions of at least $15
ScholarShare accounts can be opened online at www.scholarshare.com. For information about the SIB, visit www.treasurer.ca.gov/
Disclosure: This is a sponsored article, but all opinions and stories are completely my own.