St Paul (KROC AM News) - A Minnesota program that offers an incentive to put aside money for college expenses is taking part in a national effort this week in hopes of gaining more participants.

The Minnesota 529 College Savings Plan is observing National 529 Day with a promotion that runs Tuesday - May 31st.

During this period, the program will contribute $50 to new account holders who deposit $50 and set up automatic contributions of at least $25 for six months.  

“Despite these uncertain times, the Minnesota 529 College Savings Plan remains committed to helping families save in whatever way works best for their budgets and goals,” said Jim Mandler, senior marketing manager for the Minnesota 529 College Savings Plan. “National 529 Day shines a spotlight on the importance of saving for higher education, and programs like ours make it affordable, convenient and cost-effective to get started.”

A day dedicated to raising awareness of the rising cost of higher education, National 529 Day encourages parents to start planning for their child’s college education. Here are three reasons to get started with MNSAVES today: 

Enjoy significant tax benefits while saving for college
MNSAVES is a tax-advantaged 529 college savings plan, which means that money you invest with the program could save you money on state taxes. For 2020, account owners, regardless of their relationship to a child, may be eligible to deduct up to $3,000 ($1,500 for single filers) from their Minnesota income tax. In lieu of the deduction, taxpayers may be eligible for a maximum state tax credit amount up to $500, subject to phase-out based on certain federal adjusted gross income thresholds. 

Low fees equal more money to invest
For nearly two decades, MNSAVES has sought to make higher education more accessible to families.  In October 2019, families saving for college through MNSAVES saw a greater percentage of their contributions invested for future higher education expenses when total asset-based fees were reduced resulting in an overall 30% reduction in average fees. The average plan fee decreased to 0.15 percent; about four times lower than the national average for 529 plans.1 As one of the nation’s lowest cost 529 plans, MNSAVES makes your goal of saving for your loved one’s education more attainable.  

Flexibility and investment tools to help you succeed 
MNSAVES offers a menu of investment options designed to meet your needs at any given time. You can contribute whatever dollar amount is feasible to your account ($25 minimum), and when it comes time to pay for college, funds can be used to pay for college, universities, technical colleges, professional schools, graduate schools, as well as certain continuing education courses – nationwide and at many schools abroad.

MNSAVES also offers the option to schedule automatic contributions from your bank account or by payroll deduction, making regular contributions hassle free.

“We want to be your savings partner,” said Mandler. “And while we know families may run into uncertainty at one time or another, our low contribution amount makes it easy to stay in the habit of contributing. Even modest savings will add up over time.”

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