Author: Deborah Goodkin, Managing Director, Savings Plans, First National Bank of Omaha
At the end of February, winter can seem nearly endless. After months (and months) of chilly weather, it’s hard to imagine that warmer days are on the horizon. But rest assured, when you least expect it you’ll spot the first green buds of spring – and with a little sunlight and care, these sprouts will soon grow and bloom.
When it comes to your college savings, a little care and attention can go a long way as well. While we patiently await the first sprouts of spring, read on for a few simple steps to foster growth in your NEST 529 account.
Re-commit to New Year’s Resolutions
At this point, your New Year’s resolutions may feel like ancient history. But resolving to forge better savings habits is a great idea at any time of year – and it’s never too late to pick up where you left off.
Take the opportunity to assess your current situation and long-term goals to set specific, achievable targets for the remainder of the year. Tools such as automatic monthly contributions and payroll direct deposit make the savings process even more convenient and straightforward. With automatic contributions, it’s easy to stick to your goal. You can even schedule regular increases over time.
Find Creative Ways to Contribute
In addition to regular contributions, finding creative ways to add to your college savings can really pay off. NEST 529 hosts a variety of scholarship opportunities throughout the year, offering the chance for a big financial boost while encouraging the whole family to engage in the college savings process. Last year we awarded more than $120,000 in scholarships and account bonuses, and we’re keeping up this momentum in 2019. For a list of currently running scholarships, visit www.NEST529.com/scholarships.
Making saving for college a collaborative activity can open new ways of contributing to your NEST 529 account. For example, encourage your child to enter a local essay contest, or print fliers for babysitting or dog walking services. When the time comes, match or double the earnings that they contribute to their NEST 529 account. These activities teach valuable financial skills, and can make saving for college an engaging experience for the whole family.
Keep Cool through Market Volatility
This quarter has seen increased market volatility, which can be nerve-wracking for investors. But before making a big change to your account, keep in mind the ways that NEST 529 works to protect your savings in any market.
First, making consistent, long-term contributions to a NEST 529 account means that the returns on your investments will have the opportunity to average out over time. Though the markets may be volatile right now, continuing to regularly contribute can allow you to average out potential losses against gains over longer market cycles when the markets recover. You may even view this period as a good time to increase contributions and take advantage of lower asset prices within your investment portfolio.
If you are invested in an Age-Based Option, your portfolio is designed to adjust and grow more conservative as the Beneficiary approaches college age. Of course, there can be no guarantee of returns on any investment. However, if the Beneficiary is young, time is on their side relative to market cycles and recoveries.
If the risk of the market seems too great, NEST 529 offers a FDIC-insured Bank Savings Investment Option, which protects your initial savings while offering a varying rate of interest. This is available as a Static Investment Option, and is also included in certain Age-Based Portfolios alongside other non FDIC-insured underlying funds. Remember, you have the power to switch your Investment Options twice per calendar year.
Keeping your college savings top of mind is one of the best ways to give your NEST 529 account a boost – whether it’s through increasing contributions, finding creative ways to save or staying informed of your Investment Options. We may still be waiting for those first few sprouts of spring, but there’s no reason to wait when it comes to your college savings.