529 Plans

In this version of New America's weekly podcast, Media Relations Manager Kate Brown sits down with Mark Huelsman, Program Associate with New America's College Savings Initiative to discuss the connection between savings and college completion, the advantages of 529 college savings plans, the ability of low-income families to save for college, and policy proposals to help them do just that.

Earlier this year, the Obama Administration released a bold new plan for improving the state of higher education in the United States. Its fiscal year 2010 budget proposal included several items aimed at increasing postsecondary education enrollment and completion rates, and decreasing the financial burden that college represents to many lower and middle class families. [1] These proposals include reforming the federal student loan program, expanding Pell Grants for low-income students, and creating a new College Access and

Jackie Williams, executive director of Ohio's CollegeAdvantage plan, says a 529 needs a range of aggressive and conservative options. Aggressive plans are often sought by parents who started saving late and hope to catch up. ...

The Potential of 529 College Savings Plans

At a time when low-income students are underrepresented in higher education and the cost of attendance is becoming increasingly unaffordable, 529s have the potential to address issues of college readiness, access and completion.  College savings can help make higher education more affordable, and have the potential to change aspirations and behaviors of both students and their parents.  Research from the asset building field has shown that even a relatively

Key talking points on 529 plans, their current flaws, and how progressive features might remedy them.

 

 

 

 

Background on 529 college savings plans

In 2001, the Internal Revenue Code authorized college savings plans (529 plans) as a tax-advantaged savings tool. In a 529 plan,[1] individuals save money in an account that is dedicated for future college expenses of a beneficiary. States administer 529 plans, and offer a limited selection of funds with a range of risk and return characteristics.[2] In

Qualified Tuition Plans, commonly called “529 plans” after the applicable section of the federal tax code, were implemented in their present form in 2001. These state-sponsored plans can help families save for their children’s college education, or an adult can open an account to use for their own post-secondary expenses. Under current law, earnings and qualified withdrawals are exempt from federal income tax liability. Because these tax incentives are scheduled to expire after 2010, Congress intends to act to make these provisions permanent.