After hearing an NPR program about young people and savings, I joined the “Your Money and Life” Facebook group that NPR created to provide assistance and encouragement to young adults who are venturing into investments. Though I can’t say I’ve learned much from the group yet, post notifications have been a helpful reminder to keep me investment-oriented.
For the month of December they created a pledge to open 529s by the end of the year. It happens that I was looking into my state 529 college savings plan prior to that and had planned to open accounts for my kids with the money that they received as gifts from Christmas. In fact, I had been accumulating this money in my personal savings account for my son with no place else to put it, so I finally made the move to invest it in college funds.
It seems to me (a novice) that the MN College Savings Plan has low fees and a good range of investment options. I selected managed accounts based on their ages. I have heard that managing your own accounts is the way to go to save more money, but my style is to contribute and look at it very little until it is time to make a withdrawal.
While education is a high priority for my husband and I, we don’t intend to pay for our sons’ full tuition. Saving that much is probably not even possible for us right now. Instead, I started the 529s to invest what money is gifted to them throughout their childhoods in the hopes that it will grow. Minnesota 529s were a great option for this because the minimum amount to start an account is $25 and the contribution minimum is also only $25. Plus, they make gift contributions easy, so I am hoping that their grandparents will get on board with helping them save rather than giving so many toy gifts.
And it’s now that time of year. Tax time. The suggestion on the original radio program was to take whatever return you receive and open a retirement account. While I contribute to one through my employer, my husband hasn’t started one yet. Whatever amount we get back will be going into an investment account which he will continue to contribute to monthly. Fingers crossed our return will be sizable, but even if it’s not, it’s a move in the right direction.