May 7, 2008 3:32 pm US/Central
Treasurer: Deposit Stimulus Checks In College Fund
CHICAGO (STNG) ―
It might not be what the president was hoping for, but the same week that the Chicago City Treasurer urged residents not to go on a spending spree with their economic stimulus checks, the state's treasurer is advising parents to put the proceeds into a college savings account.
State Treasurer Alexi Giannoulias said money deposited into a Bright Start College Savings account this year could double in about 10 years.
Giannoulias, in a release Wednesday, said that in addition to earning interest on their investments, state residents can deduct Bright Start contributions on state tax returns. Participants also pay no federal or state taxes on earnings or withdrawals for qualified college expenses.
Bright Start is a 529 college savings and investment plan sponsored by the Illinois State Treasurer's Office and managed by OppenheimerFunds.
"You can open an account with your stimulus check and set up automatic deposits from your checking account in about 15 minutes," Giannoulias said. "It's that easy."
According to a study by the Web site savingforcollege.com, if a family invested a $1,500 rebate (the maximum amount for two parents and one child) into a 529 plan's age-based option when the child is a newborn, and the plan duplicates its average returns until the child turns 18, the account will grow to $9,575, the release said.
On Monday, city treasurer Stephanie Neely, while warning people about scams tied to the IRS checks, urged Chicagoans to save part of their stimulus refund and avoid the high check-cashing fees at currency exchanges.
(Source: Sun-Times News Group Wire © Chicago Sun-Times 2009. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
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