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Tag Archive: National Association of State Treasurers

Financial Literacy & Consumer Focused Legislation Keys to Success for the Future of College Savings

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USCapitolBuildingThere are two things I really enjoy in life. One is visiting our nation’s capital. The other is watching Saturday Night Live. For years, I have been a lucky person because it seems like these two things always seem to find each other in funny satire political skits. Whether it’s Will Ferrell impersonating President George W. Bush or Jay Pharoah taking on the persona of President Barack Obama, you never have to look too hard to find humor in American politics. As easy as it is to poke fun at our country’s leaders, a trip to D.C. reminds one what a tough and big job our federal leaders have. From the economy to education and foreign policy to the environment; each day brings a new set of challenges for our elected officials. They are consistently pressed for their time and attention, just like many of us with our own jobs. The key to their success –like our own — is having an understanding of a variety of topics, issues and subject matters, while not losing sight of the big picture and remembering what’s most important. Two weeks ago I returned to my office after spending a productive week in D.C. at the National Association of State Treasurers (NAST) Legislative Conference where financial literacy was an overarching theme. Given treasurers’ responsibilities of managing the finances of their states, they are very interested in the financial literacy of their citizens. This made me think about my own job in helping families save for their children’s college education and how we have an incredible opportunity to help young parents understand the basics of financial planning and budgeting. In addition to financial literacy, several state 529 program directors met with legislative staff to educate and gain support for H.R. 4333 and to also identify co-sponsors for the technical bill, which was introduced to the U.S. House of Representatives late last week. This legislation will make 529 plans more flexible and remove some of the barriers participants may have to saving, including:

  • Making computers an eligible expense;
  • Allowing for investment changes up to four times a year (right now it is limited to once a year);
  • Allowing the redeposit of funds for certain circumstances (e.g. a student gets sick at the beginning of the term) (Right now you can’t redeposit funds to an account once they are disbursed);
  • Allowing leftover funds from a 529 to roll over to a Roth IRA under certain circumstances (e.g. a student gets a scholarship their last year, or graduates early).

While all of this technical work is important; it’s critical to remember why we are doing it. Our goal is to help improve the lives of families and children through education and smart financial planning. As student loan debt surpasses $1 trillion, it’s now more important than ever to ensure families have accessible and affordable ways to save for education and avoid being saddled with more student loan debt. We thank Congresswoman Lynn Jenkins (R-KS) and Congressman Ron Kind (D-WI) for their leadership and effort to help American families as they strive to save for college. We look toward a swift action by Congress to ensure these measures are passed.

Written by Betty Lochner, GET Director and CSPN National Chair

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