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By Lael M. Oldmixon, M. Ed., Executive Director, Education Trust of Alaska

July 16, 2024

As someone who appreciates the advantages of saving for education with a 529 plan and is a 529 account owner for my two beneficiaries, I applaud families who have diligently planned and contributed to a loved one’s account. When it comes to the pivotal moment of paying the first qualified expenses, account owners can spend less time stressing about how to pay for college by following these easy steps and more time celebrating the success of their savings journey:

Step 1: Calculate Your Qualified Education Expenses

529 plan account owners can withdraw any amount from their 529 plan, but only qualified distributions will be tax-free. The maximum amount you can withdraw tax-free is the total amount of qualified expenses paid during the year minus any amount used to generate other federal tax benefits. 

The remaining amount is your maximum withdrawal amount. You should consult a tax professional or financial advisor to learn more about how tax-free educational assistance and tax credits may impact your 529 withdrawal. 

Step 2: Time the Withdrawal

Withdraw your funds in the same calendar year you plan to use them so that the year’s withdrawals align with the year’s education expenses. Be sure to keep all your receipts. Toward the end of the calendar year, review your expenditures to make sure you have withdrawn funds to cover all qualified expenses. Be sure to give your 529 plan administrator enough time to process your withdrawal request in the same calendar year (approximately 10 business days).

Step 3: Select the Recipient

Account owners are responsible for requesting the withdrawal and may choose to have the funds sent directly to the school, to the beneficiary, or to themself via check or ACH.

If you are sending the funds to the school, be prepared to provide your plan administrator with the beneficiary’s name, student ID, and the school’s name and address.  

Step 4: Request the Withdrawal and Plan Ahead

Most plans allow you to request a withdrawal on the phone, online, or via paper form. Visit the plan’s website and review the options available to you.  

Whichever method you choose, once you have finalized the withdrawal request, follow up with the school to ensure the funds hit the account, keep an eye on your bank for the funds to arrive, or watch for the check in the mail.

End-to-end, it’s recommended that you give yourself a buffer of about 10 business days. If the payment is due on August 15, consider making the request for withdrawal by about August 1. 

Last fall, I wrote an article
about navigating the first year of college, which is a guide for both students and parents. While the tips may be most beneficial for your student, they may also be helpful for you! 

Navigating the First Year of College: A Guide for Both Beneficiaries and Their Parents

Here’s a preview of the article: 

Before Arriving

Continue reading and print the complete list here. 

About the author:

Lael M. Oldmixon, M. Ed., is the Executive Director of the Education Trust of Alaska, which offers Alaska’s three 529 plans: Alaska 529, the  T. Rowe Price College Savings Plan, and the John Hancock Freedom 529. She lives in Alaska with her spouse, two children, and two dogs. 

By Jamie Dushin, Accounting Manager, Achieve Montana, Montana’s official 529 Education Savings Plan.

July 9, 2024

At the end of last year, student loan debt in the U.S. totaled $1.74 trillion.1 That makes for an average monthly student loan payment of more than $393.2 And while loan forgiveness initiatives are up in the air every few months, here’s one thing that’s for sure – saving early can outweigh both the costs and stress of paying for college and higher education. As parents, we’ve learned to do just about anything to help our children – perpetually share the bathroom with our toddler, stay up until 4 a.m. completing school projects, watch the same cartoon episode for the twentieth time (you know the one). But what if, in 2024, instead of stretching ourselves thin to ensure our children’s future, we started saving for it?

Here are the top 5 reasons why starting a 529 plan beats taking out student and federal loans on any given day!

#1: Saving is less expensive than borrowing.

We’ve crunched the numbers, talked to advisors, factored in inflation, and considered rising tuition costs – no matter how you spin it, saving now beats borrowing every single time. And we get it; it doesn’t always make logical sense or even financial sense to set aside hundreds of dollars each month. But what if we told you that setting aside even small amounts (think $15, $25, $50) each paycheck could save you thousands of dollars in the future? Yes, thousands – tens of thousands.

#2: 529 plans can cut tuition costs.

Speaking of costs, college tuition continues to rise every year. Along with it are associated expenses like textbooks, study materials, and room and board. While 529 plans can’t directly cut the tuition price, they offer flexible spending options – allowing students to pursue their general education credits at a less expensive college and then use the rest of their funds toward their primary degree. Funds in most 529 accounts can be used at nearly any two-year or four-year university, trade or technical school, or qualified apprenticeship program. See your state’s plan for additional details.

#3: Zero interest & tax-deferred growth.

And here’s one of the best parts – no interest payments AND tax-deferred growth! What does that even mean? We’ll break it down for you. Unlike a loan, no borrowing is involved, eliminating any compound interest you would owe. But what does add up is the additional savings you acquire! With flexible investment options, every dollar saved in a 529 account has the potential to become another dollar earned. In other words, you save, and then you save again!

#4: 529 plans can be used alongside financial aid.

When it comes to saving for higher education, many parents worry that opening a 529 plan will hurt their child’s eligibility for receiving federal aid. And while the fear is valid, it’s just not accurate. Will a parent’s 529 savings be taken into consideration when reviewing FAFSA applications? Yes. Will they have a significant effect on your child’s financial aid package? No. If your student is a dependent, the funds in your 529 account are considered the parent’s asset. As a result, when determining one’s “Student Aid Index,” funds in a parent’s 529 account will generally be counted at a rate only up to 5.64% of its value – making a minimal difference in financial aid eligibility.

#5: Proactive savings ignites confidence.

We saved the best for last. As parents, we know that our children can dream anything, be anything, do anything! But, as kids, that can often be hard to understand. So, hold onto this – Not only are children who know they have college savings accounts more likely to attend college, but behind every gift, every contribution, and every investment choice is your affirming and resounding voice saying, “I believe in you.” And that voice, your voice, can be the strongest investment of all.

About the author:

Jamie Dushin is an Accounting Manager at Achieve Montana, Montana’s official 529 Education Savings Plan. To learn more, visit achievemontana.com.

References

1https://www.federalreserve.gov/releases/g19/HIST/cc_hist_memo_levels.html

2Board of Governors of the Federal Reserve System Report on the Economic Well-Being of U.S. Households in 2016- May 2017

By Brittany Leona Parks, writer, my529

Are there any products available today that can truly improve financial, career, and mental well-being? Consider what a 529 college savings plan can do. Setting money aside to reduce or eliminate the need for student loans can benefit lives significantly.

Boost early income. Embarking on the adventure of your first job can be stressful enough without having to worry about a significant portion of that paycheck being unavailable. Students commonly believe they can worry about their student loans later. Unfortunately, the payments often come due simultaneous to other expenses in a young person’s life, like buying a car, relocating, or setting up a new home. This is also when early investments have the greatest potential for growth over time. These factors can have a crucial influence on future wealth and quality of life.

Set a strong foundation for life. The financial burden of student loans can delay other milestones like starting a family or buying a home. Gen X first experienced the burden of student loans, then Millennials, and now it shapes how Gen Z views the value of certain degrees or schools. For second-generation college graduates, parents’ outstanding student loan debt could have affected how much money their parents could set aside for them to attend school.

Find freedom and flexibility to optimize opportunities. Recent graduates likely saw their parents struggle economically during the Great Recession and, as such, understand that jobs are not distributed with diplomas. Allowing for some extra time to find the best position — rather than settling for just any job that will pay the bills — can boost lifetime earnings and accelerate career advancement. It can also give you the freedom to pursue a more fulfilling job, but perhaps it pays less.

Reduce the potential to feel financially overwhelmed. Student loans — just like any financial debt — can increase stress and lead to life-long and far-reaching negative consequences. Failing to keep up with student loan payments could ruin credit scores and result in garnished wages and Social Security benefits. Life can be challenging enough, and it’s unlikely that a recent graduate wouldn’t have, at the very least, some financial concerns. This can make facing decades of future bills feel particularly intimidating, especially if students understand how compound interest can change the equation.

Benefit from earnings — not accruing interest on a loan. If students can set aside money now, those compounding gains can work to their advantage. Demonstrating how saving pays off is a beautiful lesson that can also benefit future generations. It is important to remember that, on average, students who graduate with postsecondary degrees see higher earnings, more career opportunities, and better health outcomes — making the cost of higher education even more worthwhile.

Help your student be part of the over 30% who graduate from higher education without student loans and reduce the financial, career, and mental health burdens through investing early and often into a 529 college savings plan.

About the author:

Brittany Leona Parks is a writer for my529, Utah’s educational savings plan. When not researching financial best practices for children, she is trying these strategies out on her own two kids, hiking with her family, and participating in entirely too many book clubs. She previously spent 8 years marketing to the financial and legal sectors.

By Jonathan Hughes, Associate Director of College Planning and Content Creation, Massachusetts Educational Financing Authority

June 25, 2024

If there is one pernicious myth that I could stomp out of existence, it would be this one: “I can’t save any money for college because the financial aid office will see it, and then I won’t receive any financial aid.” Though this is a common belief among families with college-bound students, it’s not true. Let me explain.

Financial aid is awarded on two bases: merit and financial need. When you hear about academic, artistic, or athletic scholarships, these are examples of merit-based aid granted to recognize student achievement. In most cases, family finances are not considered when awarding merit-based aid.

Most financial aid is need-based. When applying for financial aid, families are asked to submit financial aid applications, including the FAFSA®. Based on the information reported, including income, assets, taxes paid, and family size, students receive a Student Aid Index (SAI). This formula-calculated figure is intended to represent a family’s financial strength and ability to pay for college. A low SAI means more eligibility for financial aid. Most people assume that saving for college will result in a high SAI and, therefore, less financial aid eligibility.

What most people need to know is that most of the weight in the SAI calculation is given to income, not assets. In fact, the SAI formula used by every college and university only takes into account, at most, 5.6% of parent total assets, which include college savings accounts. This means if a family saved, for example, $50,000 for college, the SAI formula would only include $2,800 of that in the student’s SAI. So, the impact of saving for college on financial aid is minimal, to say the least. And remember, if a family has saved $50,000 for college costs, that means they’ll have $50,000 to use for the college bill that they won’t need to borrow and pay back later with interest.

College savings accounts started by grandparents have even less effect on financial aid because they’re usually not counted at all. In the past, grandparent contributions from a college savings account toward a college bill counted as student income on the FAFSA, which had a detrimental effect on that student’s financial aid eligibility in later years. That treatment has been changed. Now, college savings accounts owned by grandparents (as well as aunts and uncles) and distributions from those accounts are not asked for anywhere on the FAFSA. The CSS Profile, a financial aid application used by roughly 200 colleges across the country, does ask for information about relatives who plan to provide funds to help pay for college expenses, but it’s up to each college whether or not that information is even considered when awarding financial aid.

Over the years, I’ve spoken with many families who are very concerned about the impact that saving for college will have on their child’s financial aid. But their minds are put at ease once I explain how the SAI formula works. In all my years working to guide parents through college planning, I’ve never spoken to one parent who has regretted saving. In fact, the most common sentiment I hear is, “I wish I had done more.” 

Our message to families should be one of encouragement and education, letting them know that if they haven’t started saving for college, they should begin today. 

About the author:

Jonathan has worked at Massachusetts Educational Financing Authority (MEFA) for 20 years, helping families in Massachusetts prepare for college. As Associate Director of College Planning and Content Creation, he provides guidance on planning, saving, and paying for college to students and their families and serves as host of the MEFA Podcast.

School is out for the summer, grills are fired up for barbecue season, and summer vacations are in full swing. As you shop for hot dogs and sunscreen, you will likely notice that school supplies are creeping back into stores.

As a parent, it feels like we never really get a break from thinking about our children’s education. I love a good deal on pencils and notebooks for my high schooler, but I am usually not ready to think about returning to the classroom in the fall until at least August.

If you have a college-age student, however, it is the perfect time to start thinking about preparing for withdrawals from your 529 plan. Whether you have a child heading off to college or are planning to use the funds for other qualified educational expenses, it’s essential to have a plan in place now for making back-to-school withdrawals.

Here are some tips for preparing for fall withdrawals from your 529 plan:

1. Review your needs: Before making any withdrawals, review how much you have saved and how much you will have to withdraw. This will help you avoid taking out more than you need.

2. Know the plan rules: Some states differ regarding what are deemed to be qualified education expenses, so be sure to familiarize yourself with your own state’s definition. It’s important to understand what is allowed before making any withdrawals.

3. Plan: If you know you will need to make withdrawals in the fall, it’s a good idea to plan in advance. How soon you get your money can vary depending on the method you choose for withdrawing funds. A check, for example, might take longer to arrive at a school than if you send your withdrawn funds electronically. Know your school’s deadlines. Planning will help ensure you have access to the funds when needed and can avoid any last-minute stress or delays.

4. Keep track of expenses: As you prepare to make withdrawals from your 529 plan, be sure to keep track of all your qualified educational expenses. This will help you stay organized and ensure that you can prove how you used your funds should you face a tax audit.

5. Consider tax implications: When making withdrawals from your 529 plan, it’s important to know the rules on how 529 funds are taxed. While contributions to a 529 plan are made with after-tax dollars, withdrawals are generally tax-free if they are used for qualified educational expenses. However, if you use the funds for nonqualified expenses, you may be subject to taxes and penalties.

Preparing for fall withdrawals from your 529 plan doesn’t have to be stressful. By reviewing your account balance, knowing the rules, planning, and keeping track of expenses, you can ensure a smooth and successful 529 withdrawal process. And remember, if you have any questions or need assistance, don’t hesitate to reach out to your 529 plan for help.

Now, go enjoy summer!

About the Author

Cherie Zajdzinski is a content creator for Utah’s my529 plan. She recently relocated to Utah after spending two decades living in Anchorage, Alaska, and is thrilled to be a part of the mission of helping families save for higher education.

Where does a penguin keep his money? In a snow bank.

What did the hamburger name it’s baby? Patty.

What’s brown and sticky? A stick.

When I earned the title “Dad” after our first child was born, the realization that I am entitled to these corny puns was not lost on me. After our fourth child was born, I thought, “This means I am allowed four times the dad jokes, right?” According to my wife… wrong.

But one thing we could agree on? Our commitment to saving for our children’s education.

All jokes aside, being raised by teachers, I understood the importance of education for personal and professional growth. But I also know it’s expensive, which is probably why the start of a Google search for “Is college…” usually ends with “…worth it?” It’s also why my wife and I knew the answer to getting ahead of the cost was opening a 529 account for each of our children.

And you can, too. These investment accounts are an easy way to help the children in your life reach their education goals and help you reach your financial goal to get them there. Here’s how:

529 plans…

  1. Help families save for the costs of education, including K-12, college, graduate, and vocational tuition and fees; books and supplies; student loan payments; room and board; computers; and more
  2. Provide federal (and state, depending on the plan) tax-advantages, including tax-deferred earnings and tax-free qualified withdrawals
  3. Can be opened by anyone, including parents, grandparents, other relatives, and friends
  4. Give control to the account owner since they decide where, when, and how the funds are used, no matter the student’s age
  5. Offer flexibility if the student decides to forgo or postpone their higher education, including the ability to transfer funds to an eligible family member with no penalty

Intrigued? Start researching the right plan for you with CSPN’s 529 Search and Comparison Tool. From there on out, it’s all about rolling with the punchlines until it’s time to use your hard-earned savings. Easy as pie!

About the Author

Iowa State Treasurer Roby Smith is the administrator of Iowa’s 529 Education Savings Programs, College Savings Iowa and the IAdvisor 529 Plan, with over $6 billion invested and more than $5.1 billion in qualified withdrawals.

By Paula Smith, Senior Vice President, Product Strategy and Development – Retirement and College Savings, Voya Investment Management

Having access to higher education has been a transformative experience that has profoundly shaped my life. The opportunity to obtain a college degree opened an endless world of possibilities for me. Although my school was only four hours from my urban neighborhood, it felt worlds away.  

Fundamentally, as parents plan and save for their child’s education, they hope that he or she will not only build a fulfilling career but gain valuable knowledge and skills and a deeper understanding of the world around them. Parents also hope their child will acquire lifelong friends along the way. As I reflect on my own life lessons from my higher education experience, these really stand out:  

Independence: While initially being responsible for running most aspects of your life on your own may seem daunting, ultimately, it is empowering and builds confidence. Simple things like getting to class, learning to navigate other people and situations, and managing my time independently were invaluable lessons.   

Budgeting and Saving: Most college students are pressed to stretch the dollar. Through many part-time and summer jobs and careful planning, I was able to manage day-to-day expenses and plan for a significant trip after graduation. I have carried this lesson throughout my life.

Love of Learning: The journey of intellectual growth is never-ending, and there will always be new horizons to explore, new mysteries to unravel, and new ways of understanding the world around us. That lifetime love of learning has been the personal and professional fuel that will continue to propel me. 

Perseverance: The most important life lesson from higher education is maintaining a long-term outlook in the face of challenges. Grit is about doing what it takes to achieve personal goals.  

Gratitude: While this lesson arrived a bit later than the others, I am profoundly grateful for those who helped along the way: those who awarded scholarships and provided aid, my school and professors, and my parents, grandparents, friends, and other relatives. We simply can’t do it alone.

As I started my career after graduating, I began working with retirement plans and their participants, which was a perfect fit for my skill set and what inspired me. Helping people set goals, work to achieve financial independence, and get on a path to retirement was incredibly rewarding for me.    

Shortly after, I learned about 529 plans and was immediately fascinated by the elegance of these programs—how contributions are made and invested and, ultimately, how they are used to help parents pay for their child’s education.   

The primary objective of a 529 plan is to help beneficiaries access higher education. These programs provide many benefits. They are easy to open and fund, offer strong tax benefits and incentives to help people meet their savings goals faster, and offer flexibility if educational plans should change. As college costs have continued to increase, leveraging a 529 plan early and with purpose makes college more attainable.  

These plans have come full circle with the new Roth IRA rollover provision within 529. They now offer both the ability to help fund a college education and (if money is left over) give the beneficiary a head start on retirement savings.  

Today, I find it particularly rewarding to engage with advisors and participants about saving for college. Higher education has many positive ripple effects, opening doors to fulfilling careers and transforming lives. I am honored to play a role in changing the lives of young people—just as my own life was transformed—and helping to ensure the dream of a college degree is within their reach.  

About the author:

Paula Smith is Senior Vice President, Product Strategy and Development – Retirement and College Savings for Voya Investment Management, a wholly owned subsidiary of Voya Financial.  Voya Investment Management serves as 529 Program Manager for the Wisconsin Tomorrow’s Scholar® 529 program and the Iowa IAdvisor program. She has over 20 years’ experience working with retirement plans and 529 programs. 

By Trisha Good, Executive Director, Ohio Tuition Trust Authority

May 29, 2024

I am a firm believer in the power of saving in a 529 plan as my family has personally experienced its benefits. My husband and I saved in 529 plans for our two children’s education and career training after high school. With the help of our extended family, they both graduated from their respective colleges DEBT FREE! And now, I am saving for my two wonderful grandchildren for their future education.

As we celebrate May 29 as 529 Day, I want to share the many reasons why my husband and I chose to save in a 529 account.

529 tax benefits

All earnings in a 529 plan are tax-free, so all investment growth is yours to use for higher education expenses. Compound interest—the interest earned on contributions, earnings, and interest already accumulated in the 529 account—is included in your 529’s tax-free earnings.

529 plan withdrawals for qualified higher education expenses are also tax-free at schools that accept federal financial aid. These costs include tuition; room and board when the beneficiary is enrolled at least half-time; mandatory fees; computer equipment and related technology as well as internet services; books, supplies and equipment related to enrollment and classes; and certain expenses for a special-needs student. Room and board costs can also include rent for off-campus residencies—apartments, rental homes, and Greek fraternities and sororities’ houses—and groceries (non-taxable items only), provided these costs are equal or less than the school’s room and board allowances. 529 plans can also pay for fees, textbooks, supplies, and equipment, including required trade tools for registered apprenticeships.

Many states also offer tax deductions or tax contributions for contributions made to the state’s 529 programs. If you want to see your home state’s benefits and tax information, CSPN has a great tool to review your state’s program and compare it to others.

Use at many kinds of schools!

529 plans can be used for your child’s education and career training after high school – whether for a two-year, four-year, graduate degree, certificate programs, registered apprenticeships programs, or any other post-secondary credential. This list includes community colleges and technical schools, vocational or trade schools, graduate schools, and even some study-abroad programs. If the school has a Federal School Code with the Federal Student Aid, an office of the U.S. Department of Education, then you can pay for qualified costs there with a tax-free 529 withdrawal.

Others can help save

As the adage says, “It takes a village to raise a child.” When loved ones asked us for gift ideas for our children, we asked for contributions to their 529 accounts for their future. Most contributions to a 529 plan can start as low as $10-$25. Also, many 529 programs offer gifting platforms that allow trusted

family members and friends to make online gift contributions directly to your children’s 529 accounts without needing the actual account number.

529 flexibility

Not only can you use your 529 account for post-secondary education expenses, but you can also use it for K-12 tuition at a public, private, or parochial elementary or secondary school. This means your education saving account can cover many costs for elementary, secondary, and post-secondary education. The 529 withdrawal limit is $10,000 per year to pay for K-12 tuition. Consult your qualified tax advisor for specific information.

Families can also pay for a student loan that qualifies for the federal student loan income tax deduction with a 529 distribution. There is a $10,000 lifetime limit for the beneficiary of a 529 account. Another $10,000 can repay the qualified student loans of the beneficiary’s siblings.

At the start of 2024, a new tax-free qualified distribution was added to 529 accounts. Now, any remaining funds in a 529 account can be rolled over into a Roth IRA for the same beneficiary as the 529. There are prerequisites that must be met to use this new qualified distribution. Consult your qualified tax advisor for specific information.

There’s a lot to celebrate about 529 plans on 529 Day. After all, any investment in a 529 plan is an investment in your child’s future. To learn more about 529 higher education saving plans, please visit CSPN.

About the author:

Trisha Good is the executive director of Ohio Tuition Trust Authority. Since 1989, Ohio Tuition Trust Authority has sponsored and administered Ohio’s 529 College Savings Program, CollegeAdvantage. Ohio’s 529 Plan oversees nearly 675,000 accounts and over $17.22 billion in assets as of March 31, 2024. Visit CollegeAdvantage.com or call 1-800-AFFORD-IT (233-6734) for more information.

By Alyson Luszcz and John Mitchell, Co-Chairs, CSPN Data, Operations, and Technology Committee

Every year, a big group from our workplace (or office) gathers for a summertime outing at a Chicago White Sox baseball game. Some of the colleagues who join are baseball fanatics and others could not name one player on the team. Invariably, at least someone is attending the first baseball game in their life. As we talk over beer and peanuts, some colleagues admit to feeling sheepish about how little they know about baseball. As devoted baseball fans, we always tell them there’s nothing to be shy about and remind them that even the most passionate fan has many things left to learn about the game.

As it turns out, we see similar a similar phenomenon among those saving – and not saving – in 529 plans.

Across the broad American population, approximately 10% of households are estimated to be saving in a 529 plan.[1] Interestingly, an additional 23% of the population is estimated to be saving for college in other vehicles such as checking accounts and other tax-preferred accounts.

Why are so many families saving for college in something other than a 529 plan? In a 2022 survey commissioned by the College Savings Plan Network (CSPN), the most common reason families reported saving for college in anything other than a 529 was “unfamiliarity” with 529 plans. Given that nearly 1 in 4 families are saving for college but not in a 529, states and plan administrators have a lot of work to do to help more families understand all the benefits that 529 plans can offer, including tax-preferred growth, state-level tax advantages, professional designed investment options, and much more.

However, just as the most devoted baseball fan has many things left to learn about the game, the same CSPN survey found that approximately 60% of those currently saving in a 529 plan did not know at least one of the following advantages of 529 plans:

  1. Funds saved in a 529 can be used across all states in the US, not just at institutions in a 529 plan’s host state.
  2. 529 plans can be used for traditional 4-year colleges as well as 2-year colleges, graduate school, vocational school, technical school, and apprenticeships.
  3. Money saved in a 529 plan is not forfeited if not used to pay for education.
  4. 529 plans have a small impact on financial aid.
  5. Anyone can open a 529 plan – including parents, aunts, uncles, grandparents, friends, and other loved ones.

Clearly, 529 plans have additional work to do to help their current account holders fully understand the flexibility and benefits associated with 529 plans. The good news is that the survey found that 75% of account holders wanted their plan administrator to provide more information on the cost of college and effective strategies for maximizing savings. 

As a state administrator and private-sector plan manager of 529 plans, we look forward to doing all we can to educate families – from those saving in a 529 plan today to those who have yet to hear about 529 plans – on the full range of advantages that 529 plans can offer.

Alyson Luszcz has over 20 years in the 529 industry and is currently AVP, Advisor-Sold Plan Program Manager at T. Rowe Price.  She serves as Co-Chair of the CSPN Data, Operations, and Technology Committee and is based in Owings Mills, MD.

John Mitchell is Director of College Savings at the Illinois State Treasurer’s Office, where he oversees Illinois’ two 529 college savings plans: Bright Start Direct-Sold and Bright Directions Advisor-Guided. He serves as Co-Chair of the CSPN Data, Operations, and Technology Committee and is based in Chicago, IL.

[1] All statistics referenced in this blog post are taken from the CSPN National Survey of College Savers, released in May 2023 by the College Savings Plan Network. The survey was a nationally representative sample of more than 35,000 respondents. A public version of the report is forthcoming.

By Eva Giles, College Savings Program Manager, Finance Authority of Maine

May 14, 2024

Graduation season is a time for celebrating the accomplishments of the students in our lives. What do you gift a graduate to acknowledge these accomplishments and inspire them in the next steps of their journey? To give a gift with a lasting impact, look towards KSAs—knowledge, skills, and abilities.

Knowledge
Graduates will be entering a brand-new world. Whether it is moving to a college campus to begin a 4-year program, starting a part-time course load while balancing work and school, or embarking on a certificate or apprenticeship program focused on developing technical skills, your graduate needs to understand the process, their role, and their responsibilities in this new setting. Do they need to visit the Financial Aid Office, complete student loan counseling materials, or seek out a work-study job? With your help, your student will know the actions they need to complete, important deadlines, and who to contact. Your gift of knowledge while building their own expertise will reduce anxiety and make their tasks manageable.

Skills
Everyone needs help with skills for “adulting.” Introductions and handshakes are important aspects of first impressions that many students don’t practice, and they could use your guidance to perfect them. The ability to create a monthly budget and strategies to commit to the plan is another helpful skill for your graduate to develop as they enter adulthood. Your gift of skill sharing can set the stage for their success.

Abilities
Students need to develop the ability to communicate effectively and to advocate for themselves. Is your student able to talk and write about their strengths and interests? Can they effectively complete a scholarship application? Can they express why an employer may want to hire them for a summer job? Can they navigate a new school infrastructure to get their questions answered? Your help can make a tremendous difference. Edit a scholarship essay or a resume. Provide feedback during a practice interview. Review the college website. Help them become familiar with resources that are available on-campus as well as in the community. Your gifts of wisdom and experience can be just the support they need.

Everyone wants to feel like they have what it takes to succeed. When starting a new challenge, it is helpful for your student to have you reinforce that belief in them. Words of encouragement, recognition of prior achievements, and tangible rewards, such as a contribution to a 529 account, are gifts that demonstrate confidence in your student and encourage confidence in themselves. Sharing your knowledge, skills, and abilities toward building a prepared and resilient individual is one of the best ways to convey – Way to Go, Future Graduate- You got this!

For resources and tools that may help your future graduate, please visit FAMEMaine.com.

About the author:

Eva Giles is the College Savings Program Manager for the Finance Authority of Maine, administrator of NextGen 529®. NextGen 529 is Maine’s section 529 plan which many families use to save for higher education. Outside of work, Eva and her family spend time hiking and enjoying the natural beauty Maine has to offer.