INDIA ABROAD May 19, 2017 21 CAMPUS AFFAIRS
ay 29 is National
529 Plan Day.
probably won’t get
the day off from
work. However, in
honor of the holiday, let’s take a
look at what a 529 Plan is and
why you need one.
What is a 529 Plan?
A 529 Plan is an education
tuition plan that is both tax-free
on savings and investments. It is
the most popular savings vehicle
for college, grad school, and
529 Plans come with many
Tax breaks are the most well-known advantage. Earnings are
not subject to state or federal tax
when used for a qualified education expense. Other investment
options, such as mutual funds,
are hit with a capital gains tax at
withdrawal. This is not the case
for 529 Plans, making them one
of the best ways to save long-term for college.
Need another reason to open a
529 Plan? Ok, I will let you in on a
529 little-known secret.
Both parents and students are
happily surprised when I tell
them that 529 Plans can often to
be used to pay for a gap year.
What is a gap year?
A gap year is a life-changing
year, typically taken between
high school and college. Students
often travel, volunteer, and
deepen their understanding of
both themselves and the world
they live in.
I know what you’re thinking.
I am not British nor wealthy; I
can’t do a gap year.
That’s not the case anymore.
More and more American stu-
dents are pursuing a gap year. In
fact, a growing number of stu-
dents are using funds they
already have in their 529 Plans to
pay for their gap year.
The most prestigious universi-
ties throughout the country are
promoting gap year programs.
Malia Obama has deferred her
admission to Harvard to pursue a
gap year and she is certainly not
alone. Harvard encourages their
students to take a gap year. They
are eager to defer admission to
allow students to pursue a trans-
formative gap year.
Students are listening, gap
year programs are on the rise.
Harvard is hardly alone.
Tufts University, Princeton
University, and the University of
North Carolina — Chapel Hill
have all developed their own
service-based gap year programs.
At UNC, students in the Global
Gap Year Fellowship are granted
$7,500 to use towards a service-oriented gap year. Selected students have the leeway to design
their own service-based initiative.
Princeton’s Bridge Year is a
nine-month gap year program
that is tuition-free. Small groups
of students perform service-based projects in five countries:
China, Bolivia, India, Indonesia,
Ok, now that you are daydreaming about a globetrotting
gap year, let me tell you how to
pay for it.
Depending on the program,
many gap year programs qualify
for using 529 Plan funds. In addition to utilizing these funds,
numerous gap year programs
also offer scholarships and
unique funding options.
Not sure where to begin?
Not to worry, below are four
transformational, structured gap
Thinking Beyond Borders
Thinking Beyond Borders has
been a global leader in gap year
programs for over ten years. Not
only do they offer culturally
enriching experiences, but they
work hand-in-hand with students to help fund their gap year.
At TBB, applicants can both
apply for a scholarship and
receive support in raising funds
toward their tuition. The TBB
staff assists students in building
a crowd funding campaign
through Generosity.com. TBB
founder, Robin Pendoley,
explains how ‘giving expertise to
help shape the message and
structure of the campaign has
helped ensure students success
in raising their tuition. Students
have raised anywhere from a few
thousand to over twenty thou-
Outward Bound’s mission is to
change lives through challenge
and discovery. Expeditions and
programs bring Outward Bound’s
mission to life through a variety
of wilderness and urban programs, including 30 to 85-day
wilderness expeditions for gap
year students seeking real-world
Semester specialist, Jason
Stout, highlights the value of gap
year programs. ‘Gap year pro-
grams are a more holistic
approach to education that better
prepares a student for college
and beyond. Imagine interview-
ing someone for a job who has a
college education and has suc-
cessfully completed a challeng-
ing 80-day wilderness expedition
— it sets them apart.’
Outward Bound’s partnership
with Western State Colorado
University accepts 529 College
Savings Plan through their
Extended Studies program.
Registration is not limited to cur-
rent Western State Colorado
University students; anyone can
participate. Another perk is that
students can receive anywhere
from three- 18 credits, depending
on the length of the course.
Youth International is another
gap year program, affiliated with
Western State Colorado
University, that accepts 529 Plan
payments and offers academic
credit. Youth International
Founder & Director, Brad
Gillings, has over twenty years
experience planning gap year
programs. He described to us
how participants on a gap year
semester join a team of fourteen
students, who together explore
three different countries with a
mix of rugged travel, intercultur-al exchange, homestays, volunteer work, and outdoor adventure.
NOLS offers immersive gap
year experiences where students
explore remote corners of the
globe, from Alaska to Tanzania.
Gap Year Advisor, Dan Chell,
details how NOLS students ‘gain
leadership experience, confidence, and college credit, which
can be transferred to their university at the end of their gap
Students can use their 529
Plans and NOLS Scholarships to
pay for this monumental experience. Your last name does not
have to be Obama to partake in a
life-altering gap year. A 529 Plan,
along with scholarships and
financial aid options, can help
make that dream a reality.
Kristen Moon is an independent
college counselor and founder of
MoonPrep.com. She specializes in Ivy
League, Gap Year, BS/MD Programs,
and International Students.
Way to Use
Your 529 Plan
By Kristen Moon