A college savings account can be online

It is not exactly a secret that college is getting more expensive. Many individuals in my generation, the Millennials, are already very familiar with college debt. And since my generation is having or getting ready to have children of our own, the thought of the expense of college in 15 to 20 years is quite daunting. There are many ways to save for college and you should have a conversation with your financial advisor (I am not a financial advisor) but, if you go the route of a 529 plan, in Ohio, it can be created and managed all online with CollegeAdvantage https://​www.collegeadvantage.com/.

As defined by the US Securities and Exchange Commission, “A 529 plan is a tax-advantaged savings plan designed to encourage saving for future college costs.” In other words, it is like a retirement account but for college savings. 529 plans can include a combination of stocks, bonds, mutual funds and cash. Tax advantages can include tax deductions on your annual income for contributions and tax reductions on earnings in the account. There are limits to the tax benefit and an accountant or financial advisor can give you more information.

First of all, creating a new 529 plan at CollegeAdvantage.com is fairly easy. You can use a form online to enter all the necessary information, such as personal information, on the account owner and the beneficiary. You can set up an account for each child you have. Once you have created an account, you have several options of adding money to the account. For example, you can link your bank account to the 529 plan and have automatic withdrawals or, if you prefer something a bit more traditional, you can print off forms to mail in checks.

Of course, you must also make decisions on what funds you would like to invest your 529 money in. CollegeAdvantage has a number of fund options based on your goals and risk levels that have different ready-made mixes of stocks and bonds. This is a great point in time to consult a financial advisor. However, if you wish, you can divvy up the money how you see fit. CollegeAdvantage provides a number of tools you can use to see the past performance of funds.

Once your account is up and running, you can measure its performance online. When you sign into CollegeAdvantage, you will see charts of your 529 plan’s balance and the change over time. You can get other statistics such as annual rate of returns, year-to-date contributions and historical balances. You can also make changes to your plan’s investment mix if necessary.

Another handy tool that you can access online with CollegeAdvantage is UGive. UGive will generate a unique code for you to give to friends and family. They will then be able to give directly to your 529 account if they wish. In some cases, these gifts can also be tax deductible for the giver.

Government initiatives, especially on the web, can be cumbersome and difficult to use. However, CollegeAdvantage seems to work very well and is fairly intuitive. If you would like to learn more, visit collegeadvantage.com. Without an account you can use tools to estimate investment returns and tax savings. At the very least, it is worth a conversation with a financial advisor.

Brian Boyer is the managing partner of Web Pyro (http://​www.webpyro.com) located in Wooster.