Gift suggestion: a college savings account

There aren't many Christmas gifts that continue giving year after year, but a college savings account will be worth its weight in gold when today's child cashes it in for school someday.

What's more, educational savings accounts established before the end of the year may be eligible for a tax write-off up to $3,240, among other benefits.

"You don't get that on a Nintendo game," said Lynne Ward, director of the Utah Educational Savings Plan. Enrollment for an account in Utah's award-winning 529 college savings program is now available online, accessible any time of the day or week at www.uesp.org.

Online enrollment provides account owners immediate access to the account, to make contributions and changes, enroll in payroll deduction and get started tracking the investment. Since the option became available, 35 percent of all new accounts have been set up online.

"Significantly enhancing our enrollment feature should encourage more Utah families to save for college," Ward said. "This is the fastest and easiest way to enroll." She said the entire portfolio is available in as little as 10 minutes, compared to nearly two weeks when applications are submitted by mail.

Making a savings account a gift now, Ward said, means that instead of paying interest on Christmas purchases made on a credit card, "you'll be earning interest."

In addition to convenience, Ward said, accuracy is improved due to the addition of an online application. All that is necessary to set up an account is the demographic information of the account-holder, as well as the beneficiary's Social Security number.

There is no mandatory minimum for a UESP account, which is different from savings plan programs in other states.

"People are using this, they're signing up in the middle of the night," she said. "People now are so Web-savvy and Web-oriented."

The number of new accounts and contributions to accounts dramatically increases during the month of December due to the availability of state tax deductions and/or credit. UESP already has more than 109,000 account-holders, and numbers are expected to exceed 112,000 by the year's end.

New account applications and contributions, including online enrollment, must be received at the UESP office by 5 p.m. on Dec. 31 to qualify for the 2007 tax year.