Posted by Chuck on May 28, 2019
Deals

Published on May 28th, 2019 | by Chuck

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[Expired] $50 Bonus for Opening a 529 Plan with ScholarShare [5/28-5/31]

Update 5/26/19: Deal is back for Scholarshare again. Valid from May 28th until May 31st. Hat tip to reader Yosk

Update 11/30/18: Looks like the deal will return for December 5th – December 12th. So far we’ve only been able to find a working link for ScholarShare. Hat tip to reader Superman.

Update: Added Ideal and FL Prepaid offers. 

The Offer

ScholarShare link | Virginia529 link | Idaho Ideal link | Florida Prepaid link

In honor of “5/29 day”, various 529 plans are offering a special bonus for those opening a new 529 plan:

  • Open a 529 plan with ScholarShare with $50 and get a $50 match
  • Open a 529 plan with Virginia529 with $50 and get a $50 match
  • Open a 529 plan with Ideal Idaho with $25 and get a $25 match
  • Open a 529 plan with Florida Prepaid with $25 and get a $25 match

The Fine Print

  • These offers are available nationwide
  • ScholarShare is through June 1, and Virginia529 is through May 31

Our Verdict

Being that these two are offering a similar bonus, there may be similar bonuses elsewhere. I’m not familiar with the ins and outs of college plans and their tax affect – please do your own research before deciding whether to open one and which plan to choose. (People who get a state tax deduction to contribute to their own plan in their own state should do that first.)

Regardless, it could be a nice bonus for someone saving for college who was planning to open a 529 plan anyway.

Hat tip to readers Misha and to Jeffery who notes that you can open multiple accounts by having the beneficiary and account owner combination be different 



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Prasanna
Prasanna

Thanks Chuck. So, is this only eligible for Virginia residents?

Stevil
Stevil

Seems to be available nationwide: https://money.usnews.com/529s/virginia

Blake
Blake

Anyone Know if it’s a Soft Pull to open ScholarShare Account?

007
007

Definitely NO hard pull. I’m not sure they even do a soft pull, as there are no identity verification questions, etc.

Blake
Blake

It’s Asks for your Name and Social Though?

Ann
Ann

Any type of financial account will ask for that. They need to know who you are regardless of whether they’re checking your credit.

007
007

I’ve had one for half a year and no hard credit pull. My brokerage account at Vanguard also asks me for name and social and also no hard credit pull. Only brokerage I am aware of that does a hard credit pull is Schwab. They all ask for name and social. Heck, even Insight and I believe Netspend ask for name and social.

Sparky
Sparky

Nationwide offer(under the FAQ on virginia 529’s website anyone in the US can open a Virginia 529 account)- Virginia 529 offer. Can open multiple accounts by having the beneficary and account owner combination be different. Tax pro tip for VA- You can deduct 4k per account. (Instant 6% return on your state taxes). Minimum auto debit is $25. Start debit at the end of august to maximize the return and minimize outlay in cash. Try to balance this against maybe a 10% return in the S&P 500, hassle factor, and contributing via giftofcollege.com links.

Virginia529 will contribute the Match to qualifying Invest529 accounts on or about September 28, 2018. I think it’s more like invest $50 by May 31 plus monthly 25 debits until oct to get the $50.

Match Amount: 1. Virginia529 will fund only one (1) fifty dollar ($50) Match per unique beneficiary and account owner combination. The value of each Match is $50.00. 2. Virginia529 will contribute the full amount of a Match to the one (1) qualifying Invest529 account and will not split a Match between multiple Invest529 accounts or multiple Invest529 portfolios. 3. Virginia529 will fund up to $250,000 total in Matches for all qualified Invest529 accounts. If the $250,000 limit is met before May 31, 2018, the Match offer described herein is immediately terminated, and Virginia529 will provide notification at Virginia529.com that the Match is no longer available. Virginia529 will only fund the Match for the first 5,000 qualified Invest529 accounts opened during the Match term described immediately below. Timing: 1. New Invest529 account applications must be completed and submitted online between May 22, 2018 at 12:00 a.m. ET and May 31, 2018 at 11:59 p.m. ET. 2. At least $50 must be contributed to the new Invest529 account and recurring bank debits must be established by August 30, 2018. 3. Virginia529 will contribute the Match to qualifying Invest529 accounts on or about September 28, 2018.

Stevil
Stevil

Looks like Idaho has a $25 math as well, possibly just for the first 150 people.
https://www.idsaves.org/home/match.html

https://www.savingforcollege.com/article/celebrate-529-college-savings-day

All of these are available nationwide, per US News

Atul
Atul

I was researching for last couple of days, wasn’t aware of 5/29 as well.
NY and CA were my final choices.. ended up going to NY in spite of these $50 from CA.

529 is long term saving, don;t let $50 sway your choice.

savingforcollege.com and morning star have pretty good research content.

MontyFC
MontyFC

You can open both NY and CA, get CA bonus and transfer it to NY.

anthonyjh21
anthonyjh21

Sound advice here. If you’re investing in a 529 plan you should be looking at the track record of the company, investment options and of course fees. Doing your homework on which states have tax deductions is also key. Selling out for $50 just isn’t worth it.

I live in California and as such it makes no difference where we invest because we receive no benefit one way or the other. We went with the Utah plan (my529.com) because they’re an established program that has been at the top or close to it for 10+ years now. For what it’s worth the Nevada plan was our second choice.

They also have more investment options than other 529 accounts. We went with a simple portfolio of two index funds, vanguard total stock and total bond markets. Simple, low cost and easy to re-balance as time goes on as my very young girls get closer to college.

JuicyJosh
JuicyJosh

+1 for Utah
– FL resident
Even if your home state offers a tax incentive, consider doing the minimum to gain full benefit in your home state and open in UT or another top tier plan for the remainder.

Wold
Wold

So – if I wanted to use the 529 for a private school tuition (to which my state’s deduction doesn’t apply), would there be any downside to opening up an account and cashing out as soon as the bonus posts?

SamSamSam123
SamSamSam123

As far as I know None. I have done the same with Nevada Plan. I kept the one for college savings separate and opened new for K-12 Tuition which i cashed out right away, I am planning to the same for these bonuses.

Max
Max

This is just easy free money it seems like..

My understanding is that you can either choose to withdraw the money with a 10% federal tax penalty.. OR just use it to pay for some classes.

I have a 529 plan which I’ve contributed to but never actually used before. There’s about $100 sitting in there for a few years.

Am I missing anything? I only have a basic understanding of 529 accounts.. but just wondering if I understand it correctly.

I’d like to sign up for all 4 of these bonuses. I’ve already signed up for 3 of them.

Max
Max

wait, for the Idaho one.. do they need to inform people whether they’ve already hit the 150 limit or no? I may hold off on that one. I guess they would have already hit the 150 limit by now.

Lrdx
Lrdx

Yes, there is a penalty to withdraw from a 529 plan for unqualified usage (i.e. not education), but it’s only applied to GAINS. Any withdrawal is prorated between original contribution and gains. So If you contribute $100, get $50 gains (this bonus from the article probably considered as gains – at this point 66% of the account is original contributions, 33% is gains), withdraw $75, then you need to pay penalty on $25 (33% of the withdrawal), $50 of the withdrawal is from original contributions.

This penalty is 10%, plus added back as income (so your normal tax rates apply). California also adds an extra 2.5% penalty (even though they don’t give credit or deduction for contributions – that is, any 529 plan if you’re resident, not about the CA 529 plan).

Plus if your state gives state tax deduction or credit for contributions, you need to pay the difference back.

Tony
Tony

Would there california state tax consequences (given I live in Wisconsin) if I receive this $50 bonus from California?

Lrdx
Lrdx

Probably not. 529 plans should be only taxed by the state of your residency.

Superman
Superman

Virginia529 just posted $50 match reward to my plan, which has also returned +$4 since May.

William Charles

Nice

Superman
Superman

For those who missed the last $50. https://www.scholarshare529.com/holidayoffer

Superman
Superman

California residents who meet eligibility requirements should definitely try to stack for possible $225 match. http://mgp.scholarshare.com/

They can submit the verification page now, then try waiting until 12/5-12/7 to open through the holiday offer page with $200 initial deposit instead of $50. The monthly automatic contribution is the same $25 for both offers.

If they don’t stack, then at least get the higher of the two offers. Matching Grant Program is “subject to availability of funds” and does not stack with “other promotions or incentive offers”.

Jeremy
Jeremy

Must have kid under 14 and make less than 75k

Superman
Superman

Double posted.

sam
sam

This scholarshare holiday offer is for a $50 Amazon GC not cash. It seems you can still do this offer if you did the one for cash several months ago with them as long as you open this account with a different beneficiary.

Grant

Dang, just opened a 529 a few weeks ago without the $50 bonus. Might try contacting them during the promotion to see if they can match the promo.

Ken
Ken

I found this useful article explaining on how to save $1200 a year for college.
https://www.savingforcollege.com/article/psst-want-1-200-for-college-join-upromise

junk442
junk442

still waiting for that $50 from scholarshare opened in May

Superman
Superman

Assuming you do the 6 months, ScholarShare 529 will match $50 on or before January 31, 2019.

Superman
Superman

ScholarShare just posted $50 match reward to my account opened in May of 2018.

MW
MW

I have two young kids – each have 529s through our state (NE) in programs that come highly rated. Is this worth signing up to have extra? I assume the account fees will eat up any benefit over time. We only get a tax break if we contribute to our state 529.

Superman
Superman

If that same $400 contribution could have been worth a $20 tax break, then ask yourself whether gaining $100 of Amazon gift cards is worth losing $20 in cash? With a 0.08% ER, ScholarShare has one of the lower, if not the lowest, 529 plan fees out there.

NE gives tax break for contributions to in-state plan, but not out-of-state plan, and qualified distributions are not taxed by Fed regardless, but will NE tax qualified distributions, depending whether it is an in-state or out-of-state plan?

Jim
Jim

The mailer I got for this offer says the offer is valid from Dec 5 to Dec 7 only. It has a different link than the one posted above, but the link in Doc’s article says the same.

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