Upromise
Savings Accounts are a way to save for college by spending money. Every time you
purchase an eligible good or service with a Upromise company, a portion of the
purchase price will be contributed to your Upromise account. These accounts are
non-interest bearing accounts; therefore, in order to maximize the benefit of
one of these accounts, it should be linked with a 529 Plan. If you link an account
with a 529 Plan, Upromise will periodically sweep the assets from your Upromise
account to the 529 Plans. There are several 529 Plan accounts that can be established
and linked to your Upromise savings account: Fidelity
manages several 529 Plan accounts. Fidelity chooses the mutual funds that will
be made available in each plan. The following are the Fidelity managed accounts
that can be linked to a Upromise Savings Accounts: -
The Unique College Investing Plan: This plan is administered by New Hampshire. -
U Fund College Investing Plan:
This plan is administered by Massachusetts. -
Delaware
College Investments Plan: This plan is administered by Delaware. Salomon
Smith Barney also manages several 529 Plan accounts that can be linked to
your Upromise account. Salomon Smith Barney chooses the funds that will be available
for investment in these accounts. The plans are listed below: Vanguard
Group and Strong Investments manage the Upromise College Fund plan. This plan
is administered by the state of Nevada and managed by Upromise Investments. Vanguard
and Strong Fund portfolios are available in this plan.
Assets in your Upromise account are held by Upromise
Investments. Upromise Investments is a registered broker-dealer with the SEC and
a member of the NASD. They are a member of the Securities Investor Protection
Corporation (SIPC), which insures the securities of customers, up to $500,000. Savings
can be made to a Upromise account for any future college student. A future college
student can be anyone who is a U.S. citizen that wants a higher education. Basically,
it can be anyone whose higher education expenses you wish to pay. Students can
be added at any time. The account holder has ultimate control over the account
and the student does not have access to the account. The
first step in taking advantage of the Upromise program is to enroll. Go to www.upromise.com
to join for free. There are several
ways to save to your Upromise account:
With Your
Credit Cards
Register your credit cards on the web site and every time
you use your credit cards at a company that participates in Upromise, a portion
of the purchase price will be deposited into your account. Citibank
Upromise Credit Card
You can apply for a Citibank Upromise credit card
that offers 1% back every time you use the card so when you use the Citibank card,
you get 1% from Citibank — on top of the other company's contribution. Company
Programs
Sign up with the company and the company will deposit savings
into your account. AT&T and Citibank only require that you sign up once and
McDonald's requires that you provide additional information to track contributions.
Upromise contributing companies will contribute a percentage of your spending
to savings.
Shop Online through
Upromise
You will receive automatic contributions whenever you shop online
at more than 100 sites. You will need to link to these sites through the Upromise
web site.
With Your Grocery Card
or Loyalty Cards
Register your grocery card or CVS ExtraCare Card and
you will get money for college when you buy brands such as Coca-Cola, Kellogg's,
Keebler, Tide, Huggies, Glad, and many more.
Family and friends can also register with Upromise
and direct contributions to your account for higher education expenses. You
only need one Upromise account even if you are saving for several students. You
can specify the percentage that you want contributed to go to each student. This
is called allocating the assets. You can let assets accumulate in the account,
unallocated, and allocate them at a later date. Allocations can be changed at
any time. If you remove a student from the Upromise account, any remaining contributions
in your account previously allocated to the student removed become unallocated
and remain in the account. Money can
stay in the Upromise account for as long as you want. If your child decides to
take time off and then attends graduate school, you can continue to make contributions
to the account. If your child decides
not to attend college then you have three options. You can:
-
Assign remaining contributions
and future contributions to another student. -
Withdraw
remaining company contributions. Contributions earned are considered to be cash
rebates and rewards from companies. Therefore, contributions withdrawn are not
considered taxable income to the account owner. -
Donate
remaining contributions to the Upromise Education Foundation.
If the student decides to go to a trade school,
the company contributions can be transferred to a 529 Plan and qualify for higher
education expenses.
You can begin saving
to a Upromise account even if you do not have children, and can even use it to
save for your own higher education. For more information regarding this topic, please contact The Henssler Financial Group at 770-429-9166 or comments@henssler.com.
All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing.
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