Show your love with a 529 contribution

This Valentine’s Day, consider the gift of college savings for a special child in your life

Show your love with a 529 contribution

Time to read: 2 min

In the beginning, Valentine’s Day was associated with romantic couples only, but in recent times the day is seen in a much larger perspective. Now, people take the opportunity to wish a happy Valentine’s Day to anyone they love, including friends and family. The idea is to celebrate love, and in that spirit, I believe the best Valentine’s Day gift for a special child in your life is a 529 contribution.

Here’s why.

College costs are growing

In its most recent survey of college pricing, the College Board reports that a moderate college budget for an in-state public college student for the 2017–2018 academic year averaged $25,290. A moderate budget for a student at a private college averaged $50,900.1

So where do students get that kind of money? Many turn to loans. Americans now owe over $1.48 trillion in student loan debt, and the average Class of 2016 graduate left school with $37,172 in student loan debt, up 6% from the Class of 2015.2

Debt can follow graduates for years to come

But carrying that kind of debt has ripple effects. Debt is often the primary deciding factor in career choice; new graduates may feel forced to simply get a job rather than start a career. Crushing debt may discourage entrepreneurs and those with aspirations for graduate school.

Many young people can’t afford to put aside savings, and they may forgo contributing to workplace retirement plans, which means possibly missing out on employer contributions, not to mention the potential benefits of long-term investing, such as compounding returns.

Young couples with a double-dip of student debt may often delay making life decisions, such as getting married, starting a family or purchasing a home. Many young adults move back in with their parents or other relatives temporarily.

So, while it’s easy to simply give children chocolate or stuffed animals for Valentine’s Day, a 529 plan contribution may be a more meaningful gift for their future.

1 Source:

2 Sources: US Federal Reserve; The Wall Street Journal, “Student Debt Is About to Set Another Record,” May 2, 2016

Important information

Blog header image: Olga Danylenko/

Thomas Rowley

Director, Retirement and Education Strategies

Thomas Rowley is director of retirement and education strategies and one of Invesco’s most frequently requested speakers. He provides analysis of the evolving retirement landscape and develops actionable strategies to help investors and financial advisors maximize their retirement-planning opportunities. Mr. Rowley regularly shares his insights online at in addition to his speaking engagements.

Mr. Rowley’s insights reflect more than 20 years of experience in the investment industry. He translates his comprehensive knowledge of retirement planning into lively, clear explanations of the complexities of legislative, investing, tax and social issues.

Mr. Rowley shares his analyses of retirement-related issues through regular personal appearances, continuing education webinars and Web-based commentaries.

Mr. Rowley has been director of retirement business strategy since 2010. Prior to joining Invesco in 2010, he was in charge of individual retirement plan products and Retirement Marketing at Van Kampen.

Prior to joining Van Kampen in 1996, he was a 401(k) regional sales director with an investment firm. His experience also includes seven years in retirement plan operations and three years as head of a brokerage firm’s retirement help desk. He began his career in the Treasury bond futures pit at the Chicago Board of Trade.

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