HARRISBURG, PA--(Marketwired - August 29, 2013) - Pennsylvania Treasurer Rob McCord today announced there are a few days left for families to contribute to a Pennsylvania 529 Guaranteed Savings Plan (GSP) account by August 31, 2013, to receive the 2012-2013 academic year's lower rates. After that date, credit prices will rise due to increases in tuition rates.
"With parents and children rushing to get ready for the new school year, I hope they will add 'college savings' to their back-to-school tasks," Treasurer McCord said. "Now is a great time to open a Pennsylvania 529 Guaranteed Savings Plan account, as it will serve their child long after the current school year ends."
Parents who act now can beat the increase -- simply contribute to the PA 529 GSP by August 31. Contributions sent by mail must be postmarked on or before August 31 and online contributions must be made by 11:59 p.m. EDT on August 31 at www.PA529.com.
In the spirit of back-to-school savings, the McCord Treasury is offering free enrollment -- a $50 savings -- for all new PA 529 GSP accounts opened online during August and September at PA529.com. Use code "SaveNow" when prompted. The department is also offering a chance for families to win one of ten $529 college savings accounts at PA529.com.
Treasurer McCord recently announced lower fees, reduced premiums, and a record number of participants and contributions in the Pennsylvania 529 GSP, which is designed to help savings grow to meet the future cost of education. When used for qualified higher education expenses, PA 529 GSP contributions grow at the rate of tuition inflation (subject to fees and premiums). For example, someone who saves enough for one semester today at a State System of Higher Education university will have enough for one semester there in the future, no matter when or how much tuition has increased in the meantime.
Pennsylvania also offers a second 529 plan, the PA 529 Investment Plan, in which returns are based on financial market performance. The PA 529 Investment Plan features low fees and more than a dozen conservative and aggressive investment options from The Vanguard Group, one of the nation's largest financial services companies.
Contributions to either PA 529 plan are deductible from Pennsylvania income taxes, grow tax free, and, when used for qualified educational expenses, are federal and state tax exempt. Both plans provide flexibility to pay for college expenses at most higher education institutions across the country. Pennsylvanians may deduct contributions from their taxable income up to $14,000 per beneficiary, or up to $28,000 for married couples.
"As the new school year begins, I encourage parents to do their homework on creating a college savings plan," said Treasurer McCord. "We're always looking for ways to show parents and family members with children or loved ones who they hope will attend college how a PA 529 plan can make saving for higher education easy and doable."
The Treasurer added families that wish to learn more about the benefits of a 529 plan can view free college savings webinars at PA529.com. The online presentations also allow users to have their questions answered by a PA 529 college savings expert.
For more information, visit PA529.com or call 1-800-440-4000 to open an account or make a contribution.
The Pennsylvania 529 College Savings Program sponsors two plans -- the PA 529 Guaranteed Savings Plan (GSP) and the PA 529 Investment Plan (IP). The guarantee of the PA 529 Guaranteed Savings Plan is an obligation of the GSP Fund, not the Commonwealth of Pennsylvania or any state agency. Before investing in either plan, please carefully read that plan's disclosure statement (available at www.PA529.com or by calling 1-800-440-4000) to learn more about that plan, including investment objectives, risks, fees, and tax implications.
Carrie Fischer Lepore