Four easy ways shoppers can become college savers

http://www.savingforcollege.com/articles/four-easy-ways-shoppers-can-become-college-savers

With things like retirement and rainy day funds to worry about, starting a college fund often gets pushed to the bottom of many families’ to-do lists. Today’s extreme college costs may frighten you, but if you don’t start saving now think of how scary your child’s future tuition bills will be. Maybe you’re just not a great saver. Your retirement savings are taken directly from your paycheck, but after that you spend every last dollar of your disposable income. You like to buy things, and would keep buying more if you had more money. How can you be expected to reserve some of your earnings for a 529 college savings account? Have you seen those new Pebble Smartwatches? There will always be financial aid and student loans to pay for college later, right? If this sounds like you, read on!

Top four savings essentials for young families

While saving for college often ends up on the lower end of the personal finance hierarchy, it shouldn’t be ignored. The costs of higher education are rising at alarming rates at a time when interest rates for borrowers aren’t getting any lower. In other words, loans are also getting more expensive. If you consider yourself a spender and have a hard time putting money away for future expenses, take a closer look at 529 college savings plans. Many 529 plans offer automatic investment options with monthly contribution requirements as little as $25.

One of the best things about 529 college savings plans is that they can really make your money work for you. Earnings in the account grow federally tax free, and withdrawals made toward college tuition and other qualified expenses will also avoid being taxed. Many states will also offer tax incentives for residents, including tax deductions on contributions.

Research your state's 529 plan.

If you like to shop, there are also credit cards available that will pay you back in the form of 529 account deposits. So if you’re at the mall and simply can’t resist the return of the Birkenstock sandal, go ahead and shop away – in some cases, you can earn up to 5% on purchases. For a pair of $100 Birks that means $5 goes into your 529 account and immediately starts racking up those tax free earnings.

Here are four cards that offer rewards that make saving for college easy and fun:

1. Upromise Mastercard

• Earn rewards ranging from 1- 5% cash back on purchases; with eligible online purchases through Upromise you can earn 10% or more cash back.
• Rewards can be deposited into a Upromise 529 College Savings plan, a Sallie Mae High-Yield Savings Account, used for payments toward an eligible Sallie Mae serviced loan or redeemed for checks of $10 or more each quarter.
• For a limited time shoppers will earn $25 cash back with first purchase.
• Annual Percentage Rate (APR) for purchases: 0% introductory rate for the first 12 billing cycles, after that it will change to a variable APR of 12.99% or 20.99% based on creditworthiness. Rates will vary with the market based on the Prime Rate.
• Annual Fee: NONE

2. Bright Directions 529 Rewards Visa Card

• Earn 1.529% (1.529% - get it?) on everyday purchases.
• Each quarter, rewards totaling at least $50 are deposited into your Bright Directions 529 College Savings Program.
• Family and friends can also get a card and deposit rewards into your 529 account.
• Annual Percentage Rate (APR) for purchases: 11.15%
• Annual Fee: $15.00

3. College Counts 529 Rewards Visa

• Earn 1.529% on everyday purchases.
• Each quarter, rewards totaling at least $50 are deposited into your CollegeCounts 529 Fund.
• Family and friends can also get a card and deposit rewards into your 529 account.
• Annual Percentage Rate (APR) for purchases: 11.15%
• Annual Fee: $15.00

4. Fidelity Investment Rewards American Express

• Earn 2% cash back on purchases.
• Rewards can be deposited into eligible Fidelity accounts, including a Cash Management Account, Brokerage Account, Fidelity-Managed 529 account or a retirement account.
• Offers retail purchase protection for merchandise, travel and emergency assistance, 24-hour customer service and zero liability fraud protection and identity theft recovery service.
• Annual Percentage Rate (APR) for purchases: 13.99%.
• Annual Fee: NONE