Kentucky Higher Education Assistance Authority
Gov. Steve Beshear proclaims September as College Savings Month
FRANKFORT, Ky. — Gov. Steve Beshear has proclaimed September as College Savings Month in Kentucky, a time to raise awareness about the need to save for higher education expenses. The Kentucky Education Savings Plan Trust (KESPT), the Commonwealth’s official 529 college savings plan, is encouraging parents to take time this month to review their college savings goals. A proclamation ceremony was held at Centre College on Sept. 3.
There are several factors that may influence a family’s decision to plan ahead. For example, many families save now to avoid overwhelming debt later on. The number of young adults graduating with student loan debt is climbing, forcing many to put off other life decisions like buying a home or starting a family.
Rising tuition costs are also of concern. During the 2014-15 school year, tuition, fees, room and board at a public four-year in-state school averaged $18,943 according to The College Board (collegeboard.com). Public four-year out-of-state school tuition was significantly more at $32,762. Annual costs at private schools averaged $42,419.
“As families and students are settling into a new school year, it’s a great time to discuss long-term education goals and how to prepare financially,” said KESPT Manager David Lawhorn. “Saving for college is a decision that shouldn’t be delayed because there is more earning potential over time.”
Kentucky State Treasurer Todd Hollenbach, KHEAA Executive Director Dr. Carl Rollins and Centre College President John Roush attended the proclamation ceremony, along with the Jones family of Frankfort. Their son, Keenan, is attending Centre this fall. He is a triplet so the Joneses have three children starting college at the same time. They are using the Kentucky Education Savings Plan Trust to help them do it.
A KESPT account can be opened with as little as $25, or $15 per pay period if the account owner’s employer offers payroll deduction. While parents are the most common account owners, others can help, too. Grandparents, friends and relatives can open an account for a child, or contribute to an account via an online gifting feature at kysaves.com. In addition to tax-free treatment on earnings and withdrawals, a KESPT account also offers estate and gift tax benefits.
The Kentucky Legislature created KESPT more than 25 years ago to help families plan for future college expenses. Families have used $63 million from the Plan to fund higher education expenses at 35 different post-secondary schools in Kentucky. The Plan has grown to more than $180 million in assets and currently serves 6,700 Kentucky families.
For more information about KESPT, visit kysaves.com or call toll-free 1-877-598-7878. The plan is managed by TIAA-CREF Tuition Financing, Inc., a leader in 529 program management.