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Shopping rewards and 529 plan combo can make it happen

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If you are concerned about having enough money to fund a college education for your children, these programs may be just what you need. A small number of online companies have combined a shopping rewards program with a 529 college savings plan. A 529 savings plan allows you to deposit up to $50,000 for education expenses. The money is tax deferred and is taxed at the child's rate when withdrawn.

You may have tried one of the shopping rewards programs that have been around the Net for a couple years. These are nice, and you can earn a little pocket change, but life altering, they are not. The new programs that put your rewards in a college savings account may be an entirely different story.

The rewards seem to be a little higher than most shopping affiliate type programs and more and larger companies are getting involved. They are also expanding beyond online purchases, allowing more possibilities for earning rewards. I think the real key is allowing you to register your existing credit cards so that you automatically get rewards when you use them at participating merchants.

Some consider the 529 savings plans to be tools of the rich, since the tax advantages are not that great for lower income families. However, when the money that is deposited doesn't come out of your own pocket, I can see no reason for anyone needing college money to avoid these plans.

Perhaps the greatest potential of these college rewards programs lies in getting others involved. You can get your entire family (grandparents, aunts, uncles) and friends to sign up. When you have the purchasing power of multiple households earning rewards, the savings can add up fast.

Check out these programs for yourself, and see what you think.

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