When I decided to write a book on using project planning skills to plan for family tasks, I also decided to revisit my own plan. One of the tasks on the list is to set up a college savings plan for my boys. But there have been so many other “high priority” items on our family list, that setting up an official account went by the wayside. Instead we just used a savings account that stayed dormant for long periods of time instead of creating an active savings plan for college. I decided to take the emotion out of the fact that we had not done it sooner – and commit to setting up an active college savings plan. The timing was great because I received an invite to attend a dinner to learn more about the California 529 College Savings Plan called ScholarShare that has a website, ScholarShare mobile apps and can be found on Twitter at ScholarShare529 and on Facebook. I had heard about 529 Plans before, but had not looked into the details yet.
First I checked out the information on the ScholarShare website to learn details about their 529 Savings Plan: “ScholarShare has state and federal income tax deferral on any earnings, withdrawals for qualified higher education expenses are state and federal income tax free, a low minimum contribution of $25 and high maximum account balance, has no annual account fees and a low annual asset-based fee. There are a combination of 19 investment portfolios to invest in that vary on their investment strategy and degree of risk.”
Just using the ScholarShare mobile app helped me understand how much I need to start investing each month to reach the goal of having an appropriate amount ready by the time my kids go to college. I also realized that the ability to have an amount automatically taken out of our checking account each month to put into college savings may be the only way make sure we contribute each month.
This topic is especially relevant during the holidays because a college saving plan is also something that family can contribute to as a gift. My kids get an allowance and save up for toys and other things they want during the year. So I want to offer to my family the option of giving to a college savings plan as a holiday gift option. The ScholarShare website has a “Give a Gift” option that families can use to contribute.
Do you have a college savings plan for your kids or is it also on your “to do” list? I know that I need to get started.. asap!
Listed below is the information I received from ScholarShare on their features and background info.
ScholarShare’s New Features
- “The new ScholarShare plan significantly reduces fees, expands the investment lineup, and offers online and mobile tools to make California’s 529 plan more accessible and easier to manage.
- The minimum initial contribution to open an account is now only $25, down from $50 a year ago.
- Under the revamped plan, fees will be reduced by approximately 30 percent, making ScholarShare one of the lowest cost 529 plans in the country.
- The annual asset based management fees now range from 0.18 percent to 0.62 percent, vs. 0.25 percent to 1.06 percent with old plan.
- 4 additional investment portfolios (15 to 19), giving account holders more options, depending on their savings goals and risk tolerance.
- You can also compare different college saving choices to make the wisest selections for you and your beneficiary.
- The ScholarShare website will feature informational tools to help California families better prepare a college savings plan to meet their specific needs, including a new Risk Tolerance Questionnaire.
- For the on-the-go customer, ScholarShare launched a series of mobile-friendly services, including a mobile site with full account management capabilities and a mobile app called College Savings Planner, that allows customers to keep track of their college savings goals and plan to help meet them.”
College savings report and survey info shared by ScholarShare:
- “Between 1985-2005, tuition has risen 439 percent. Source: Bureau of Labor Statistics Report
- Most California parents are worried about being able to afford the cost of college tuition, however very few have started saving to help pay the costs. 53 percent said they are “very concerned” about their ability to pay for their children’s higher education. But just 43 percent of parents have a college savings account, while 56 percent do not. Source: ScholarShare California Statewide Survey, 2012
- 84 percent of California parents considered it “very important” that their children attend college. That’s a higher ranking than having a good-paying job (75 percent) or owning a home (69 percent). Source: ScholarShare California Statewide Survey, 2012
- The average college student in 2011 had a staggering average debt of $22,900. Source: Mark Kantrowicz, FinAid.org
- Average cumulative debt has increased by 5.6% or $1,139 a year since 2003-04. Source: Mark Kantrowicz, FinAid.org
- Compared to other regions of the country, outstanding student loan payments in California and the Northeast are far greater. Many counties in California find students have to take out multiple loans, each having an average outstanding student debt per account hovering between $8,337 to $12,701
Source: Equifax, Moody Analytics
Disclosure: This is a sponsored post. All of my words are my own opinion. Those looking into college savings should consult qualified professional for advice.