ANCHOR: Saving for college tuition is high on the agenda for many parents. But where should you put the money?
ANCHOR: WGN’s money saving expert Ilyce Glink has scoured the options looking for the best deal for you.
GOOD MORNING
ILYCE: The cost of tuition, room and board has risen an average of 7 percent per year, over the past few years, which is several times the rate of inflation.
The cost of sending your child to the University of Illinois has more than doubled over the past ten years. If this keeps up, sending your child to a community college might be out of the question for many Chicagoans unless you start saving now. How can you put away that kind of money?
529 college savings plans have become a buzzword for parents trying to save for their children’s ever-increasing college education. A 529 plan is an investment plan operated by a state that is designed to help families save for college.
Illinois 529 Plan — Bright Start Savings
- Earnings are state and federal tax free
- No annual fee; free if opened through Smith Solomon Barney
- Management fee of < 1%
- Variety of investments
- Tuition, room, board, books and supplies
ILYCE: The Illinois version, called Bright Start Savings, gets the top rating from Joe Hurley, who runs the best website on the subject, SavingforCollege.com. In the Bright Start program, 529 earnings are state and federal tax free. There’s no annual fee, and the account is free if you open it through a Smith Solomon Barney broker, that’s the company that manages the 529 for Illinois. The management fee is LESS than 1 percent, which is good. There’s a variety of investments to choose from, and you can spend the money on tuition, room, board, books and supplies.
Illinois 529 Plan — Bright Start Savings
Maximum amount: $235,000
Minimum contribution: $25 initial, then $15
Online application, account access
ILYCE: The account stops taking contribution once an account balance reaches $235,000. But you can open up an account for each child, so you can put away plenty for college and graduate school. The minimum contribution to start an account is $25, and then you must put away at least $15 each time you contribution. Best of all, you can open and manage your account on line.
Want to make the most of your 529 experience?
Add to your 529 with
ILYCE: You can sign up at UPromise.com and BabyMint.com and have a small percentage of each purchase you make added to a designated 529 plan. It’s like airline miles except it’s college tuition dollars.
Illinois has a second 529 plan, a pre-paid tuition plan. But this plan, called College Illinois! isn’t as good as the Bright Start Savings plan, so I’d start there. Here are some website and phone numbers to help get you going.
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Bright Start Savings: (877) 43-BRIGHT
College Illinois!: (877) 877-3724
Joe Hurley’s Site: SavingforCollege.com
ANCHOR: Thanks, Ilyce, and you can find out more about 529 plans at Ilyce’s website, www.thinkglink.com.
June 11, 2002.
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