To Encourage Saving for College, Upromise by Sallie Mae Increases Cash Back for College During April's Financial Literacy Month
Sallie Mae Provides Simple Steps to Start a Savings Plan
NEWARK, Del.--(BUSINESS WIRE)-- To encourage more families to start saving for college, Upromise by Sallie Mae is offering bigger cash back rewards during Financial Literacy Month this April. Under the program, nearly 300 online retailers will offer cash back of 6 to 20 percent on purchases to help families save for college. Extra cash back can be earned at a wide range of online merchants such as Gap (7%), Drugstore.com (7%), Under Armour (8%) and McAfee (20%).
"With the cost of education increasing each year, creating a plan and getting started saving for college is essential," said John Ward, senior vice president, Sallie Mae. "Too often, parents don't know where to start. Upromise by Sallie Mae is an easy way to supplement your savings and this month we're doing our part to help even more."
According to Sallie Mae's "How America Saves for College 2013" study, only 50 percent of American families are saving for college, and those who are are not saving enough. Sallie Mae offers five steps to help families meet their savings goals:
Step 1: Estimate the cost of college. Use tools such as Sallie Mae's Education Investment Planner to forecast future costs at over 5,500 colleges and universities.
Step 2: Earn extra cash for college. Upromise by Sallie Mae can provide cash back through online purchases at major retailers, dining out, buying gas, shopping with the Upromise credit card or even buying or selling a home. Upromise is free to join, and savings can be invested in a 529 Plan administered by a Upromise affiliate and used to pay down an eligible loan, transferred into a Sallie Mae High-Yield Savings Account or withdrawn by check.
Step 3: Use a dedicated savings account. With a 529 college savings plan contributions grow tax deferred, and earnings on withdrawals; when used for qualified higher education expenses such as tuition, certain room and board costs, books and mandatory fees; are federally tax free.* For those who prefer a more conservative investment strategy, a Sallie Mae High-Yield Savings Account features rates 10 times the national average and the ability to earn a 10 percent match on annual Upromise earnings, a total of $175,000 extra savings in 2012.
Step 4: Put savings on cruise control. Set up an automated savings plan. Contributing as little as $25 per month to your account will add up over time.
Step 5: Do periodic check-ups. Review your college savings strategy on a regular basis, or whenever a major financial or family change occurs.
* Earnings on non-qualified withdrawals are subject to federal income tax and may be subject to a 10 percent federal tax penalty, as well as state and local income taxes. The availability of tax and other benefits may be contingent on meeting other requirements.
Before investing in any 529 plan, you should consider whether your or the designated beneficiary's home state offers a 529 plan that provides its taxpayers with state tax and other benefits that are only available through the home state's 529 plan. Investment objectives, risks, charges, expenses, and other important information are included in a 529 college savings plan's offering statement; read and consider it carefully before investing.
When you invest in a 529 college savings plan you are purchasing municipal securities whose value will vary with market conditions. Investment returns are not guaranteed, and you could lose money by investing in a 529 college savings plan. Account owners assume all investment risks as well as responsibility for any federal and state tax consequences.
Sallie Mae (NAS: SLM) is the nation's No. 1 financial services company specializing in education. Celebrating 40 years of making a difference, Sallie Mae continues to turn education dreams into reality for American families, today serving 25 million customers. With products and services that include 529 college savings plans, Upromise rewards, scholarship search and planning tools, education loans, insurance, and online banking, Sallie Mae offers solutions that help families save, plan, and pay for college. Sallie Mae also provides financial services to hundreds of college campuses as well as to federal and state governments. Learn more at SallieMae.com. Commonly known as Sallie Mae, SLM Corporation and its subsidiaries are not sponsored by or agencies of the United States of America.
Debby Hohler, 617-454-6741
KEYWORDS: United States North America Delaware Massachusetts
The article To Encourage Saving for College, Upromise by Sallie Mae Increases Cash Back for College During April's Financial Literacy Month originally appeared on Fool.com.
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