The perfect holiday gift? Double lifetime earnings
This holiday season, the Tennessee Department of Treasury invites Tennesseans to give the gift of a college education. No batteries required.
As the holiday shopping season kicks into full swing, many parents and grandparents are searching for gift ideas that are meaningful and make financial sense. With the overall cost of college expenses on the rise, the TNStars College Savings 529 Program is a great solution for many Tennesseans.
The TNStars program offers an easy way for a family to save for a loved one’s future college expenses. The TNStars program, which already offers some of the lowest investment fees in the nation, is making it even more affordable to open an account. Between now and December 31, Tennesseans who open accounts with at least $50 will each receive a one-time $50 match from the state. In addition, Tennesseans who already have another college savings account will each receive $100 when they roll over their entire account balance into the TNStars program.
In addition to being affordable and easy, giving a TNStars program gift this holiday season can also be fun. The TNStars program’s web site offers a printable gift certificate that the gift giver can customize and present to their loved one. Plus, those who make gift enrollments before midnight on December 10 will receive TNStars t-shirts in the mail. To learn more, visit www.tnstars.com/holidaygift
“This is an opportunity for families to give something that doesn’t break, doesn’t require batteries, and will continue giving a priceless gift – the gift of education,” said Treasurer David H. Lillard, Jr. “It is both a great gift and a wonderful investment in our future.”
Tennessee launched the TNStars College Savings 529 Program in September. The program is administrated by the Tennessee Department of Treasury and offers competitive fees and appealing tax advantages when compared to other 529 programs nationwide. The plan is available to everyone and the investment returns on savings are tax free as long as they are used for approved education-related expenses. The money saved may be applied to higher education, including public or private colleges and universities inside or outside the state of Tennessee as well as any other educational entities eligible to receive federal student loan funds, such as Tennessee technology centers.
Benefits of TNStars include:
Low fees that will be on par with the top-rated plans in the nation;
14 investment options, plus an age-based option, covering a wide array of investment strategies;
Federal tax-free earnings if the money is used for higher education expenses;
Availability to anyone regardless of income level. Parents, grandparents, aunts, uncles and friends can open accounts on behalf of children;
Contributions qualify for a $13,000 annual federal gift tax exclusion. Also, a lump sum of $65,000 may be contributed to the plan and treated as if it were made over a five-year period to completely avoid the federal gift tax; and
Plan contributions aren’t considered to be a part of an estate for federal tax purposes. Account owners still retain control of the accounts, but do not pay federal estate taxes on the value of the accounts. But if a gift is spread over five years and the account owner passes away within the five years, a portion of the gift will be included in the estate.
Participants have control over how they manage their investments with the TNStars College Savings 529 Program. The age-based option offers investments are more aggressive when children are young and then become more conservative as the children approach college age. TNStars also offers individual investment options, including domestic and international equities, balanced fund options, fixed income options and an FDIC-insured option. The underlying investments for the plan will be offered from more than one fund company.
