MYSA's 401kidŽ program coming soon in 2001-2002!

MYSA introduces the first incentive-based college scholarship rewards program of its kind, motivating students to achieve their goals in the classroom and on the field.

401kidŽ (www.401-kid.com) is a revolutionary college savings and incentive plan administered by a state-of-the-art online financial management engine. 401kidŽ takes advantage of 529 plans, newly enacted state-sponsored programs which enable tax free savings for college education. 401kidŽ serves a dual purpose for families-enabling effective college savings plans while providing incentive tools that motivate kids to set and achieve goals.

What is a 529 plan?
529 is a very new IRS tax code established in 1997 which provides tax incentives to families when they put money into state-sponsored savings plans.

529 plans are more attractive than prepaid tuition programs and Education IRAs because parents, regardless of income, can open accounts and invest more than $150,000 in stock and bond funds on behalf of their children. The money can be used at any school in the country while parents maintain control until their children go to college. While families have already put away roughly $9 billion in 529 plans, 401kidŽ analysts estimate that 529 investments will exceed $80 billion by 2010.

Additional benefits of 529 plans

Tax Breaks
Upon use of funds, 529 investments are taxed at the child's tax rate, typically around 15%. This is usually much less than the parents tax rate and can amount to significant savings. Starting in January 2002, the growth in these funds will be tax-free. Additional state tax breaks, which favor state residents, can offer further savings potential.

Financial Aid
Saving through a 529 plan does not affect your chances of obtaining financial aid for college. If your family earns more than $25,000 per year, you are not likely to obtain grants and can expect limited financial aid from the government. Much of your aid will be in the form of loans. Establishing 529 accounts and contributing on a schedule will help avoid paying off college loans for 10 years after they graduate.

401kidŽ Program Highlights
Here are some of the advantages of the 401kidŽ Program:

• Enables parents and families to open tax-exempt scholarship funds for their children by making nominal investments such as $25.
  
  
• Facilitates relationship management, marketing and customer acquisition for financial services firms
  
  
• Provides parents with planning and incentive tools that motivate children to set and achieve their goals.
  
  
• Corporations and communities target and support students via mini-scholarships in the form of 401kidŽ accounts and discounts.