(Update 08-01-2010) It seems the referral still works. Feel free to use my referral code 2568778, and email me after you enroll. I will send you the $25 Amazon gift card as soon as I receive the referral bonus from Ohio 529 plan.
(Update 06-29-2010) My mistake, there is not limit in terms of the number of referral. But the deadline (to get referral bonus) is still valid, June 30, 2010.
(Update 06-22-2010) 10 Referral used. 2 more remaining. Note the offer expires on June 30, 2010. Send me a note after you enroll, if you like the Amazon gift card 😀
(Update 04-27-2010) First referral bonus received and the $25 Amazon gift card sent. Please note this offer is limit to first 12 accounts opened using my referral code.
Why should I worry about my kid’s college now? She/he is just 3 years old, it’s 15 years away.
I know I know I know. I am a procrastinator too. A little more than a month ago, my daughter was born. I joked I would worry about her college tuition because I will be near retirement age when she goes to college.
But seriously, from my own 10 years 401K savings experience, “start early, and invest in high quality investments regularly” is the right thing to do. The other day, I found Nightly Business Report (NBR) folks at PBS did a nice job on this topic. They have a series of planning 101: paying for college covers the rising college costs, and how the parents can prepare well before kids going to college, very impressive reports. The only thing left for us, the parents (new or old), is action.
What is 529 Plan?
Obviously you can google and find the answer. Here is some explanation from SavingForCollege.com: A 529 Plan is an education savings plan operated by a state or educational institution designed to help families set aside funds for future college costs. It is named after Section 529 of the Internal Revenue Code which created these types of savings plans in 1996. According to the 529 plan interview at NBR (PBS), the tuition does not have to be college, it can be graduate school or re-training. I think the tax treatment of expenses other than higher education might be different (read more from Wiki and other material if you are interested).
What are the factors when we consider the plans (in-state vs. out of state; can we transfer the money later)?
There are two types of 529 plans: prepaid and savings. Prepaid plans allow one to purchase tuition credits, at today’s rates, to be used in the future. I am talking about the other plan, which is savings plan which allows us to invest in mutual funds, and let the investment grow. I believe all the 50 states offer their plans. The federal income tax treatment will be the same for plans from different states. Some state has state tax deduction for the state 529 plan, for instance, Missouri, the state where I live, has this deduction. Besides tax, I think the expense of mutual fund also affects the long term performance.
How is Ohio College Advantage 529 Plan fair comparing to other plans?
It is rated by MorningStar as one of the best plans. Personally I felt comfortable with the Vanguard and especially Winsor II fund option (again from my 401k experience). Vanguard typically has the low expense ratio (<0.50% annually). Here is the equity (stock) investment options (PDF file). The complete list of investment option is here.
What’s the deal? How do I enroll and get the bonus?
Use my reference code 2568778 when you enroll in the Ohio College Advantage 529 Plan by June 30, 2010. I used online enrollment myself which is relatively painless (took me about 15 minutes). You can do either online or by mail.
You will get $25 from Tuition Trust Authority of Ohio (the administrator of the plan) as direct deposit to your 529 plan account shortly after meeting the two requirements (if you enroll by 6/30 and deposit/fund at least $25 to your account). You will also get $25 Amazon gift card (or equivalent, for those who like gift cards from other stores) from me. I will send out the gift cards (via email or regular mail, which ever you prefer), as soon as I have confirmation of the enrollment and funding of your account.
What do I need in order to enroll?
You will need social security number, drive license, checking account (if you want to electronic fund transfer), kid (beneficiary) social security number (however, this is not absolute necessary as I saw this workaround from MyMoneyBlog). Here is the official list from Ohio 529 web site.
Why am I offering the bonus?
First, sharing, I expect to receive $50 referral fee from Tuition Trust Authority of Ohio if you meet the two requirements (enroll by 6/30 and deposit at least $25 to the account), and I am willing to share half of that with you.
Second, this is perhaps more important, I believe in “saving early and regularly” both for retirement and college education.
Email me at if you have any questions.
Read more about 529 plan at Wiki