Montgomery, Ala. (April 13, 2015) – Alabama parents: do you have a May baby on the way? If so, you could be one of 31 winners selected at random to receive $529 in a new account with CollegeCounts, Alabama’s 529 Plan. In total, over $16,000 is being awarded by the Alabama State Treasurer’s office in honor of May 29 (5/29 Day).
“When a newborn arrives, it is difficult to start planning for the long-term. This promotion, however, will help bring college planning to the forefront of thought for new parents … at least for the moment,” said Young Boozer, Alabama State Treasurer.
Parents of children born from May 1-31, 2015 have until July 1, 2015 to visit AL529Day.com and enter their contact information and the date of their child’s birth. Winners will be selected statewide at random and notified by July 17, 2015. Birth certificates or commemorative birth announcements for each winner’s child must be submitted to receive funds.
According to The College Board – Trends in College Pricing report, annual tuition, fees and room & board at a public two-year, in-state institution have increased to an average of $11,050. For those same expenses at a public four-year, in-state institution, that increase was to an average of $18,940 for a year. These are averages from across the country and illustrate the significant costs involved with a two- or four-year degree – and the importance of starting to save early.
“The first step to college planning is to establish and make an initial investment in a college savings account. Step two is to make regular investments to increase your college savings,” said Boozer. “These funds will help jump start savings for new families across Alabama.”
CollegeCounts has no minimum contribution requirements, allowing families to open accounts and save a little each month by using quality investment funds, including Vanguard, T. Rowe Price, Fidelity, PIMCO, Dodge and Cox, MainStay, and DFA.
Under the 529 Section of the tax code, special tax benefits are provided to families saving for future college expenses. Alabama taxpayers may receive a generous state income tax deduction of up to $5,000 ($10,000 for married couples filing jointly) on contributions to CollegeCounts each year.
“CollegeCounts, Alabama’s 529 plan, was designed to help families save for college while at the same time benefit from the program’s various tax advantages and benefits,” said Boozer. “The earlier and more often that contributions can be made, the better the potential return.”
Funds may be withdrawn and used at colleges, universities, trade schools and graduate schools at one-, two- and four-year schools in Alabama and across the U.S. – including vocational, technical, community, public and private colleges and universities – for qualified expenses like tuition, fees, room and board, books, and supplies required for enrollment.