Written by guest bloggers Rachel Biar, Director, NEST 529 Education Savings, Nebraska State Treasurer’s Office, and Donna Crownover, Vice President 529 Relationship Management, Union Bank and Trust.
Did you know that students with savings accounts are three times more likely to go to college?1 Have you often thought about how you will pay for your child’s higher education? Together, we can help you plan for a loved one’s future success!
As we celebrate College Savings Month, we hope you will take the opportunity to sit down with your children to discuss how a 529 education savings plan can help in reaching your goals.
Why Invest in a 529 Education Savings Plan?
529 plans were created to help parents, grandparents, aunts, uncles, and friends save for a child’s future education costs. 529 plans are tax-advantaged savings plans for higher education and can be used at accredited colleges and universities across the nation. Funds are eligible at most private and public two-year or four-year technical, trade, vocational, graduate, or professional schools as well as qualified apprenticeship programs.
529 plans are one of the few savings options specifically dedicated to helping families achieve their higher education goals. While you may not know what your child’s future has in store, a little planning today goes a long way toward future success. Invest in your child’s future today so they can soar toward their goals tomorrow.
What are the benefits of the NEST 529 Education Savings Plans?
NEST 529 Education Savings Plans are Nebraska’s 529 Plans. With a NEST 529 Education Savings account, families can invest in their loved ones’ education and have the benefit of tax advantages, flexible contribution options, and a wide range of investment choices.
Whether it’s for college, trade school, or vocational programs, a NEST 529 account can help. There is no minimum deposit to get started, and opening an account is simple and can be completed online in just 10 minutes! Once you’ve set up your account, you can manage your account transactions online and invite friends and family to easily contribute to your account through the gifting platform.
Who qualifies for the tax benefit?
The money in a 529 plan grows free from federal income tax, and withdrawals remain tax-free when used for qualified expenses. Additionally, Account Owners in Nebraska may be eligible for an annual state income tax deduction of up to $10,000 for NEST 529 contributions or $5,000 if married filing separately.2
What is the Meadowlark Savings Pledge?
The State of Nebraska is also helping to support college savings goals with the Meadowlark Savings Pledge which gives eligible Nebraska newborns a one-time $50 contribution to a NEST account for education expenses when the time comes.
Do You Have 529 Questions? We Have Answers
Meet Penny, NEST 529’s very own college savings advocate! She’s here to answer all your savings questions, explain 529 plans, and help you set your loved ones up for bright, successful futures. Check out the Ask Penny video series!
Visit NEST529.com to read more about the benefits of a NEST 529 Education Savings Plan.
1Small-Dollar Children’s Savings Accounts, Income, and College Outcomes. (2013). Center for Social Development.
2 Account owners may deduct for Nebraska income tax purposes contributions they make to their own account (and any other accounts they own in the Nebraska Educational Savings Plan Trust) up to an overall maximum of $10,000 ($5,000 if married, filing separately). Contributions in excess of $10,000 cannot be carried over to a future year. For a minor-owned or UGMA/UTMA 529 account, the minor is considered the account owner for Nebraska state income tax deduction purposes. The minor must file a Nebraska tax return for the year their contributions are made to be eligible for a tax deduction for their own contributions. In the case of a UGMA/UTMA 529 account, contributions by the parent/guardian listed as the Custodian on the UGMA/UTMA Plan account are also eligible for a Nebraska state tax deduction.
The NEST Direct College Savings Plan (the “Plan”) is sponsored by the State of Nebraska, administered by the Nebraska State Treasurer, and the Nebraska Investment Council provides investment oversight. Union Bank and Trust serves as Program Manager for the Plan. The Plan offers a series of Investment Options within the Nebraska Educational Savings Plan Trust (the “Trust”), which offers other Investment Options not affiliated with the Plan. The Plan is intended to operate as a qualified tuition program.
Not FDIC Insured* | No Bank Guarantee | May Lose Value
(*Except the Bank Savings Underlying Investment)