It might not get the attention it deserves, as it competes with Learn About Composting Day, but today is 529 Day, and we hope you don’t overdo it when celebrating.
“Yes, everything has its own day now, including 529 college savings plans, those state-sponsored accounts for college savers in which any earnings are tax-free as long as they are used to pay for qualified higher-education expenses,” Kelly Greene writes on The Wall Street Journal’s Total Return blog.
But it’s not as frivolous as it might sound. A recent survey form Edward Jones regarding 529 Plan awareness asked respondents to correctly identify what a 529 plan is; choices ranged from “a form of life insurance” to “a retirement savings plan.” According to the findings, 62% of Americans do not know that a 529 plan is a college savings plan.
The survey also found:
- Awareness of 529 plans rises with the wealth level of those surveyed
- Respondents who have college degrees were much more likely to correctly identify 529 plans
- Only about half of respondents with children knew about 529 plans
For those who currently have a 529 plan, Greene notes a number of changes in 529 investment options in the past year, as families search for less-volatile offerings.