Thought Leadership Thursday
Consider College Savings Iowa for your Advanced Child Tax Credit Payments
Thought Leadership Thursday Article
Recently I wrote this op-ed here in Iowa and wanted to share it with you. Feel free to repurpose it in your state!
Do you have a plan for your advanced child tax credit payment? Starting July 15, these advanced payments offer some families up to $300 per child, per month, until the end of the year. If you’re unsure where to start using these funds, I encourage you to consider investing the money into a child’s future by contributing the funds to a 529 plan account. It’s a great opportunity to create or build upon the education savings by opening an account or adding to the contributions you’re currently making.
While you’re improving a child’s financial future, you can also improve yours with the tax benefits offered by the plan. In addition to tax-deferred earnings and tax-free qualified withdrawals for all participants, some states also offer a tax deduction or other tax benefits. It’s a win-win for you and your student!
As you know, 529 plans allow anyone – parents, grandparents, friends and relatives – to invest for education expenses on behalf of a child. As a parent and grandparent, I can relate to a parent’s concern about what the future holds for their child. I may not have the answers, but I do know improving their financial future can give them a sense of support and encouragement to pursue their dreams. Whether those dreams lead them to a college, university, trade school or apprenticeship program, investing in a 529 can reduce their need to borrow money when the time comes.
Help the future student in your life pay for qualified education expenses, such as tuition, room and board, books, supplies, fees and more at any eligible educational institution in the United States or abroad. With professionally managed investment options, 529 plans are a great place to consider saving your advanced payment. While you’re at it, make sure you share the message with your friends, family and colleagues.
With a state-sponsored 529 account, you can give your advanced child tax credit payments the opportunity to grow, while also improving the financial future of you and a special child in your life.
Michael L. Fitzgerald
Iowa State Treasurer