Payroll deductions and automatic contributions can help make saving effortless.
Tax refunds, bonuses and other windfalls may be great opportunities to boost a 529 account.
Grandparents, relatives and loved ones can contribute to a child’s education through gifting programs like Ugift®.
March isn’t just about basketball—it’s also a great time to strategize how you’ll fund a college education. Just as a championship team needs a smart game plan, effectively saving for college requires thoughtful and diverse tactics. Fortunately, there are a number of ways to fund a CollegeBound 529 plan, all of which can help put your child or loved one on a path to success.
From automatic contributions to tax refunds and gifts from family and friends, funding a 529 is easier than you may think. Let’s explore some of the ways to get in the game and make the most of CollegeBound 529.
Like it is on the basketball court, consistency is key when it comes to funding a 529 plan. Setting up automatic contributions through payroll deductions or recurring bank transfers can help make saving for college effortless and give you the opportunity to potentially benefit from compound growth. By treating 529 contributions like a monthly bill, you can stay on track without having to think about it. Many employers even allow direct deposits into 529 plans, making it even easier to save.
For grandparents or other family members, required minimum distributions (RMDs) from retirement accounts can also be a powerful tool for funding a 529. Since earnings grow tax-free when used for qualified education expenses, this strategy may help maximize savings while supporting a grandchild’s future education.
Unexpected cash flow—like a tax refund, work bonus or an inheritance—is a slam dunk for funding a 529 plan. Instead of spending these windfalls on short-term expenses, consider investing them in a tax-advantaged education savings account.
Another powerful but often overlooked option is accelerated gifting. This provision allows individuals to contribute up to five years’ worth of annual gift tax exclusions in a single year—up to $95,000 per beneficiary for individuals or $190,000 for couples filing jointly. This approach may be especially beneficial for those looking to both reduce their taxable estate and make a meaningful contribution toward a loved one’s future.
Basketball is all about teamwork, and the same goes for funding a college education. Family members and friends can play a crucial role in supporting a child’s educational goals. Programs like Ugift® allow loved ones to contribute directly to a 529 account, making it easy to give the gift of education for birthdays, holidays or other milestones.
Recent FAFSA1 changes also make grandparent contributions even more valuable. As of 2024, funds withdrawn from a grandparent-owned 529 account no longer impact a student’s eligibility for financial aid. This means family members can contribute without worrying about reducing a child’s chances for need-based assistance.
The road to a championship—and a fully funded college education—starts with a solid game plan. By automating savings, making strategic lump-sum contributions and encouraging family support, you can potentially build a strong foundation for future college expenses.
Get started today by setting up a CollegeBound 529 account or inviting family and friends to contribute through Ugift®. Every contribution, big or small, brings you closer to victory in the college savings game.
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