Have you heard about First Step, the new Colorado College Savings Plan program? The First Step program provides a free $100 start-up contribution to a Colorado CollegeInvest 529 plan for children born in Colorado.
Requirements are straightforward:
- Children born or adopted in the state of Colorado after January 1, 2020 are eligible to receive this contribution.
- The child must also be a US citizen or resident alien with a social security number or federal tax identification number.
To obtain the $100, first, the legal parent or guardian must open a CollegeInvest 529 College Savings Plan account, making the child the beneficiary. Choosing the account type may take a little research as there are 4 options to choose from. But once you’ve selected a plan, opening the account is fast and easy.
Next, apply for the First Step program. Be sure you have your new account number and a copy of the birth certificate to upload in your submission.
While $100 is not a large amount, it is free and intended as an incentive for Colorado families to gain exposure to College Savings plans and begin adding their own contributions, perhaps sooner than they might have otherwise. An added benefit is that these college contributions may reduce your state income taxes. And as if that wasn’t enough incentive, a College Savings plan can alleviate your child’s heavy burden of paying 100% for their education and perhaps racking up student loans subject to interest charges.
If currently, you are not in a position to make contributions to the CollegeInvest 529 College Savings Plan, I encourage you to apply for the free $100 and set up the account. Every little bit helps and there is also a cool option called Ugift where you can provide a link to friends and family to make contributions to the 529 Plan. The child’s upcoming birthdays and holidays are an excellent time for friends and family to contribute to this account. Through the years this account can grow substantially and be ready for your child when they graduate high school.
Currently, we are delighted to share that we just welcomed our 3rd child into our own family. As soon as we receive her Social Security Number in the mail, we will be applying for her First Step CollegeInvest 529 College Savings Plan.
If you have new family members, born after January 1, 2020, I urge you to take advantage of this $100 free incentive to open a 529 College Savings Plan for your little one.
Lucas Casarez is a husband, father of three amazing kids, and a Certified Financial Planner™.
He founded Level Up Financial Planning, which is one of the few fee-only financial planners in Northern Colorado. The mission of Level Up Financial Planning is to guide his clients to take their financial confidence to the next level!
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