If you’re saving money for college through a tax-deferred 529 plan (or you know someone who is), a new mobile app from Sallie Mae could help you add even more to the till.
U.S. smart device users including iPhone, iPod touch, Android and Blackberry users can download the free application to earn money for college wherever they go through the national Upromise retail rewards program.
Upromise is a national program that harnesses the purchasing power of parents, extended family members and students and directs a small portion of their purchase of items from more than 800 online stores, 8,000 restaurants and thousands of grocery and drugstores into a 529 plan or high-yield savings account. The earnings can then be used to pay down a student loan or requested by check.
The Upromise app uses GPS technology to automatically find a consumer’s location and showcases nearby stores that offer Upromise rewards. App uses can view details about the participating merchants, view savings offers, get directions and share their savings via Twitter, Facebook or email.
You don’t have to be the owner of the 529 plan to help boost someone’s Upromise savings account. Friends and family members can join the program and direct their purchases to an existing Upromise account. According to Sallie Mae, Upromise members who have family and friends helping them save earn more than twice as much as members who save alone.
Although contributions to a 529 plan are not federally tax deductible, they allow investments to grow tax-deferred and distributions paying the beneficiary’s college costs come out federally tax-free. Some states, including Ohio, offer some tax deductions or credits for contributions to a 529 plan. The initial investment can be changed to a different 529 savings program or to a different state’s program if conditions change, and you can also replace the account beneficiary to another qualifying family member.
Upromise members have earned more than $600 million toward their college education costs since the program began nearly a decade ago. The program is free to join. To view a list of participating merchants and learn more about Upromise, visit www.upromise.com.