my529 celebrates America Saves Week with tips to practice saving at any age
America Saves Week is April 7-11, with daily themes focused on saving — be it automatically, for the unexpected, for major milestones, paying down debt, or saving at any age. In celebration of America Saves Week, my529, Utah’s official 529 education savings plan, aims to help you teach saving habits to the young people in your life.
Educating children early and often about financial concepts develops saving habits for their first major purchases — things like a car, higher education and future housing expenses. One of the best ways for children of all ages to save is to become a mindful consumer.
When children are young, you can invite them to hold the grocery shopping list and categorize which items are wants versus needs. Discuss ads to help them discover what they should prioritize from among the bombardment of suggestions. Finally, have them rank their wish lists to identify comparable value between their items and avoid impulse purchases.
Once children begin earning money, work with them to make a budget and have them consider what they hope to buy over the next few months and years. They may see that saving for one item may require another to be postponed. Note these competing purchases and help them organize their list into short-term and long-term goals. This approach demonstrates that saving for important expensive items starts with small amounts over time, alongside their other short-term savings goals.
To support achieving their long-term goals, encourage them to make small regular deposits into a 529 account. “A low- and moderate-income child who has school savings of $1 to $499… is about four times more likely to graduate from college.”1 They may be more likely to accomplish their career goals if they have already financially invested in them, whether those be college, technical college or registered apprenticeships.
As they approach high school graduation, they should also start investing in an emergency fund for unanticipated future needs. A car repair or job loss could cost them in credit card interest if they haven’t designated savings for life’s many unknowns.
Equipping the young people in your life with saving habits will allow them to strengthen their financial skills now to focus on achieving their short-term and long-term goals later.
my529 has been helping families across the United States invest for higher education for more than 25 years. my529 funds may be used for qualified education expenses, which include tuition, fees, books and supplies as well as K-12 tuition expenses, qualified education loan repayments and registered apprenticeships (up to certain limits). Learn more at my529’s video library or explore the my529 college savings estimator to compare potential higher education costs. When your student is ready, you can help them evaluate the higher education options that will work best for them.
1Elliott, William. (2014). Assets and Education Initiative. 2013. Building Expectations, Delivering Results: Asset-Based Financial Aid and the Future of Higher Education. Biannual Report on the Assets and Education Field, July.
