Alabama's 529 Offers Savings Opportunities and Even Scholarships
Published: December 29, 2016
By: Carol Muse Evans
You likely have already heard of Alabama’s CollegeCounts 529 College Savings Fund, a popular savings account that replaced the PACT fund in Alabama and offering more flexibility. In fact, the 529 College Savings Fund is also available in many other states. But did you know there are also scholarships available through the plan?
CollegeCounts is offering more than $1 million in scholarships to eligible recipients pursing higher education in institutions in Alabama. The online application is available now through March 1, 2017, at www.CollegeCountsAlabama.com. It is designed to provide funding assistance to students who demonstrate a financial need and a desire to make a difference in their future, says Young Boozer, treasurer for the State of Alabama and board chair of College Counts.
Eligible applicants must be high school seniors or first-time college freshmen in fall 2017 and have a minimum GPA of 2.75 with an ACT score of 26 or below, along with financial need. Range of scholarships per student is $2,000-$4,000.
The CollegeCounts Alabama 529 Savings Plan
But the CollegeCounts 529 savings plan itself is NOT just limited to schools in Alabama. It can be used for in-state college, out-of-state college, public, private, technical schools, non-profit and for profit, Boozer explains. It can even be used at overseas schools in certain instances.
“This is the best way to save for a college education for a child or grandchild, bar none,” Boozer adds. “It offers terrific investment options and administration of the plan.
“The 529 Plan offers a great structure and benefit for the student, what I like to call the three T’s,” Boozer says. “There are significant tax advantages associated with the account, both tax deductions and savings, it covers tuition, as well as fees, supplies, room and board, and timing can be from the day a child is born to offer the most value and a way to give gifts to the child throughout their growing up…the more you save, the less you may have to borrow.”
Unlike its predecessor, the Alabama PACT plan, which closed in 2008, it allows much more flexibility, Boozer says. It is your account, and you own it. You don’t have to use it just in Alabama schools, and if a child decides not to go to school, it can even be used for a parent returning to school or getting an advanced degree, Boozer explains.
Today, the CollegeCounts 529 Plan has more than $1.4 billion in investment savings and more than 81,000 accounts all over the country. While it is available in most states, Boozer says to look at your own state first, as you will likely receive the most tax deductions by purchasing in the state in which you live.
For more information about College Counts, Alabama’s 529 Fund and how to open an account, visit www.CollegeCounts529.com.
Carol Muse Evans is publisher of Birmingham parent.