What’s the Fuss About 529s?
If you’ve been hearing people talk about “529s” and wondered what the buzz is about, you’re not alone. College savings plans can sound complicated, but they all boil down to one simple goal: helping families save for future education costs.
What is a 529 plan?
A 529 plan is a state-sponsored savings account designed specifically for education expenses. The money you contribute can grow over time, and if it’s used for qualified education expenses — like tuition, books, or room and board — it can be withdrawn tax-free.*
Why are 529s so popular?
Education costs keep climbing, and families are looking for ways to get ahead of them. A 529 plan makes it easy to set money aside, invest it, and watch it grow. Friends and family members can even contribute, turning birthdays and holidays into opportunities to invest in your child’s future.
Do you have to have a 529 to save for college?
Not at all. While a 529 plan has unique tax advantages, a regular savings account can still help you get there. At 1st University Credit Union, our savings accounts offer a safe, simple way to start building your education fund without any complicated rules or paperwork.
You can open an account in your child’s name, set up automatic transfers from your paycheck, and watch those savings add up. Even small deposits can make a big difference by the time graduation rolls around.
Tips for getting started
Start early. The earlier you begin saving, the more time your money has to grow.
Set realistic goals. Aim for consistency, not perfection. Saving even $25 a month is a great start.
Automate your savings. “Set it and forget it” transfers are your best friend when it comes to building long-term savings habits.
Planning for education starts here
Whether your child’s college journey is years away or right around the corner, it’s never too late — or too early — to start saving. Stop by our branch or visit our savings account page to open a savings account and take that first step toward your family’s education goals.
*Consult a qualified tax professional for personalized advice on tax benefits and implications of education savings plans.
Content adapted from “What’s the Fuss About 529s?” by Colleging, our trusted education loan partner.