Santa Fe, NM, June 11, 2024 (GLOBE NEWSWIRE) -- According to a recent ABC News article, there will be a rise in federal undergraduate student loan rates to 6.5% by July, up from the current 5.5% rate, the highest rate in 16 years. Under this new rate, a 10-year student loan of $28,000 would accumulate approximately $10,000 in interest. With these new changes, it’s even more important to start saving for education now to help reduce or eliminate the burden of student loan debt.
The Education Plan®, a 529 education savings plan sponsored by the State of New Mexico, offers a practical, tax-advantaged solution for saving toward future education and reducing student debt.
“Our mission is straightforward: to make future education more attainable and affordable,” said Natalie Cordova, Executive Director of the New Mexico Education Trust Board, the organization that administers The Education Plan. “The Education Plan supports families with a strategic tool to save for future education expenses and lessen the challenges associated with student loans.”
The Education Plan has many benefits including tax advantages where contributions grow tax-free and withdrawals for qualified education expenses are tax-free, offering significant long-term tax savings. Additionally, many states offer a tax deduction on contributions to a 529 plan. The Education Plan is flexible, allowing funds to be used to pay for a wide variety of qualified education expenses from tuition to textbooks and room and board. Additionally, savings in a 529 plan have minimal impact on financial aid eligibility, unlike other savings programs.
The Education Plan equips families with the information and resources necessary to navigate the complexities of education financing, helping them make informed decisions and develop a tailored education savings strategy aligned with their financial goals. Many online tools such as a glossary of terms, tax benefit information, a detailed FAQ, and a help center allow people to access information when it’s convenient for them.
“By planning and consistently contributing to a 529 education savings plan, families can significantly reduce the need for borrowing,” added Cordova. “This proactive approach helps secure a successful future for students enabling them to embark on their careers with less debt.”
To learn more or open an account, visit TheEducationPlan.com.
