Gifting to a college 529 plan


Remember birthday parties when you were little?  They usually consisted of your mom’s homemade cake, and your family sitting around the table singing, “Happy Birthday” before you blew out the candles. Have you been to a birthday party lately? Parties these days are full on extravaganzas limited only by imagination: bounce houses, cotton candy, princesses, batting cages, trampolines, and llama rides (yes, I have actually been to a party with llama rides.) There seem to be limitless possibilities.


The guest list for these parties is a mile long. Usually, there are 10-20 children plus family, friends and neighbors. No one would dare come to such a soiree empty-handed. Most people will go to Toys R Us and pick up the latest toy or game. Your grandchild’s eyes light up with excitement when he rips open the paper and sees the latest and greatest techno thingamajig, and many hugs and “thank yous” ensue.


As exciting as all of that is, I ask you to go take a peek in the birthday boy’s or girl’s room. Do you see rows and rows of forgotten games with broken pieces?  How about stacks of toys that never see the light of day? There has to be a better gift that isn’t just going to turn into old junk next month. What if you could get a gift that would be remembered for several years? Yes, that’s right, years!


What about the gift of a college education? We all know college tuition costs are out-of-control. Parents help out as much as they can, but in many cases the cost of four years or more of college education far exceeds the family savings. You can be a part of the village that sends your child, grandchild, or great-grandchild to college by making a contribution to a 529 plan. A 529 plan is a college savings plan that allows for tax-deferred growth and tax-free distributions when used for post-secondary education. Anyone can set up an account, and anyone can contribute to an account that is already open.


Now, I know a contribution to a grandchild’s college fund would not get the same reaction as the newest video game would, but trust me when I say I know there will be much gratitude, albeit a little delayed; however, the  parents will be ecstatic about the contribution, and it will not be forgotten. Making a contribution to a 529 plan is not a small gift that will go unnoticed. That is a gift that will be remembered for a very long time. Imagine if someone had made a contribution to your child’s college fund; do you think you would have forgotten about it?


Check in with the grad about six months after graduation, when student loan payments begin. That is when you can expect a great big hug and a “thank you” for making their education possible.



*To learn more about how a College 529 Plan can help you, check out our other article.