The current generation of grandparents is not only living more active lifestyles in retirement, they are taking more active roles in the lives of their grandchildren. Whether it’s participating in activities together, or helping out in both financial and non-financial ways, grandparents are more engaged than ever before in the lives of their grandchildren.
A survey sponsored by Legg Mason and its 529 Plan, in partnership with GRAND Magazine, found overwhelming evidence that grandparents are more committed to being part of their grandkids lives in many ways – including a growing desire to help pay for college. This increasing trend to “pitch in” coincides with an increased level of financial sophistication among grandparents. As they age, the survey showed that grandparents actually enjoy thinking about and tracking their finances and a growing majority are opting to do this in partnership with a financial professional in a more collaborative relationship.
In increasing numbers, grandparents recognize that the flexibility and tax advantages of 529 Plans can help them put a legacy in place. When their own children were going to college, only 10% used 529 Plans, instead relying on savings and investment accounts and drawing on cash as needed. Now, with over two-thirds of those with college-bound grandchildren saving or planning to save for their future education, the number of those using 529 Plans has jumped 40 percent.
So what’s the reason for this growing need to put a legacy in place? Today’s grandparents are deeply committed to family, and have the ability to provide some financial assistance – more than any generation before them. Grandparents are hoping to pave the way toward a better life, while instilling the value of hard work. Their motivation is the hope of helping their grandchildren develop an appreciation for the value of education and the subsequent lifestyle it can bring. They want to provide grandchildren with the financial foundation that can ease their transition into adulthood – one they may not have had the benefit of receiving in their own lives.
For more information on how to start a 529 Plan for your grandchildren, go to: scholars-choice.com/grandparents