CollegeCounts donates to future education of two Madison newborns
MADISON — Two Madison families have received a jumpstart in saving for their child’s future education thanks to the CollegeCounts 529 promotion in Alabama.
The promotion was established in 2015 as a way to help families provide for their newborn’s future. The “529” comes from the 529 Section of the tax code, under which special tax benefits are provided to families who are saving for their children’s future college expenses. Because of this, 5/29 Day is celebrated on May 29.
According to JamieDay Matthews, who handled public relations for the 529 promotion, the goal of the promotion is to help “relieve some of the accompanying stress of college costs for local families.”
“The burden of college costs can be avoided by saving early and often, and our goal is for families to take advantage of both—all while receiving a tax advantage along the way,” said Alabama State Treasurer Young Boozer in a news release.
To qualify, entrants had to have a child born in Alabama between May 29, 2017, and May 29, 2018, as well as provide contact information through the giveaway on CollegeCounts’ website. Madison’s Claborn and Azzarello families were just two of nearly 30 lucky families chosen at random across Alabama to receive the $529 contribution.
Two Huntsville families and one Owens Cross Roads family also received the donation from this year’s contest.
Though the State Treasury Department is involved with the program, the donations to winners of the promotion come only from CollegeCounts program funds, and no state or taxpayer dollars are used.
According to Deputy State Treasurer Glenda Allred, the contest has typically only been open to the families of newborns born within a one-month timeframe. This year, after deciding to expand the eligibility to one whole year, CollegeCounts received almost 800 entries.
In terms of saving, Allred stressed that all families should live by one mantra: “start early and save often.”
“Pay little attention to how much money you are investing at the onset, as this is not the most important factor,” she said. “Instead, make a habit of investing, whether it’s $20, $50, $100 or more each month — get used to having that amount of predetermined money go straight from your paycheck into your children’s college savings.”
If saving is not possible when the child is born, Allred recommended making it a goal to start saving by his or her first birthday. Adjustments can be made later on, but the most important step is to form the habit.
There are no minimum contribution requirements to start saving with CollegeCounts, and Allred said more than 7,000 accounts were opened in 2017 alone.
Alabama taxpayers who contribute to CollegeCounts may receive a generous state income tax deduction of up to $10,000 for married couples filing jointly, or $5,000 for single filers, each year.
According to the release, funds may be withdrawn for use at colleges, universities, trade schools and graduate schools at one-, two- and four-year schools anywhere in the United States. This includes vocational, technical, community, public and private colleges and universities. The funds may be used for qualified expenses like tuition, fees, room and board (if enrolled at least half time), books and supplies, as well as equipment required for enrollment, including computers.
For more information on the promotion or to learn how to invest in your own account, visit CollegeCounts529.com.
