Plan. Protect. Prosper.
In the month of May we are fortunate to be blessed with many holidays. It can be argued that Memorial Day, Cinco de Mayo, or Mother’s Day holds the top spot for favorite May holiday. However, there is a date that is often overlooked which also holds a special place in many people hearts and pocket books. That day is 5-29 day aka National 529 College Savings Plan Day!
In honor of National 529 College Savings Plan Day this quarter’s newsletter is going to have a school planning theme. We hear quite often that people don’t have the time or funds to start saving for education. We are happy to announce that in a short amount of time and $25 you can get an account setup with your designated state 529 plan sponsor. Depending on your state of residence Spectrum can assist in getting one of these types of education savings plans established.
A common question we get is what are the advantages of putting my education savings in a 529 plan over depositing in savings account, investing in a brokerage account, and/or hoarding cash in my safe? The answer is tax savings. The earnings from the investments in a 529 plan grow federally tax-free if utilized for applicable education expenses. Additionally, in the state of Iowa you are able to deduct up to $3,319 in contributions per account off your state taxable income. Applying this state income deduction to a married couple with two children, they would be eligible to deduct up to $13,276 of contributions from their joint state taxable income!
In years past 529 plans were restricted to qualified higher education expenses; however, effective in 2018 individuals can utilize 529 plans to also fund qualified K-12 education costs. What exactly does qualified mean? Qualified education expense includes: tuition, mandatory fees, books, required miscellaneous supplies, computers (hardware and software), internet, miscellaneous equipment required for enrollment/attendance, and room and board during any academic period the student is enrolled at least half-time.
Spectrum is dedicated to providing its clients with all the tools and knowledge to make the best education decisions possible. This includes recently co-hosting a college planning workshop where a representative from College Inside Track spoke about the complicated process of finding the right school at the right price. College Inside Track has extended the offer for all Spectrum clients to have a complimentary initial consultation with one of their specialists. This consultation will shed light on determining the best schools, when and how to best apply for scholarships, maximizing financial aid, and maximizing merit aid. If you would be interested in receiving more information on this opportunity please contact Tyler (TC) Conley at (515) 255-3306 or email@example.com.
According to Student Loan Hero the average student loan debt for the class of 2017 graduates was over $39,400! Equipped with the information and tools mentioned above you can help keep your child/loved one from being another statistic. Have a great National 529 College Savings Plan Day!
As with other investments, there are generally fees and expenses associated with participation in a 529 plan. Investments in 529s involve investment risks. You should consider your financial needs, goals, and risk tolerance prior to investing. The official disclosure statement and applicable prospectus, which contain this and other information about the investment options, and underlying investments, can be obtained by contacting your financial professional. You should read these materials carefully before investing. Advisory services offered through Legacy Financial Group, LLC d/b/a Spectrum Advisory Services, a Registered Investment Adviser. Securities offered through Broker Dealer Financial Services Corp. Member SIPC. Broker Dealer Financial Services Corp., Legacy Financial Group, LLC, and Spectrum Advisory Services are not affiliated companies.
Tyler Conley has worked in the finance industry since 2009 and joined Spectrum in 2017. He became a CERTIFIED FINANCIAL PLANNER™ practitioner in the fall of 2016.