About a month ago, Madison of My Dollar Plan wrote about getting a $50 Target gift card when you open a new California 529 account at Fidelity. I was pretty excited because we don’t have 529 accounts for the boys yet. (I opened Coverdell Education Savings Accounts for them when they were born, though.)
This bonus offer is just the motivation I need to get those 529 accounts opened. The $50 Target gift card is a huge return in and of itself, and having the accounts open means that family can contribute to the boys’ college funds if they are so inclined. It also gives me a place to transfer my Upromise earnings, so I don’t have to go through the hassle of requesting a check.
I am disappointed that California provides no state tax deduction for contributing to a 529 account. And with the state needing all the money it can get, I don’t see that changing any time soon.
Notable fine print: The offer expires on December 31, 2008, and is limited to California residents. You must establish an automatic monthly investment of at least $50 per month, with the initial $50 automatic investment contributed and invested within 90 days after the account is opened. There’s a limit of two gift cards per person, and each account must have a different designated beneficiary and be individually owned (no trust, custodial or other ownership arrangements).
As Madison points out, the fine print states that you should allow 8 to 10 weeks from qualification for the mailing of the gift card, so you might end up having to make up to three monthly contributions of $150 per account before you can terminate your contributions. Even if you end up contributing $150 before you get your gift card, though, you’ll still get a 33% return on your investment, and you’ll have that money sitting there and growing until your child heads off to college. That’s a pretty good deal all around!