America Saves Week – April 8-12, 2024

As financial literacy and wellness continue to be paramount in today’s economic landscape, Delaware Treasurer Colleen Davis once again encourages Delawareans to participate in America Saves Week, the initiative aimed at promoting saving, budgeting, and financial stability across the nation.

The theme for America Saves Week 2024, which runs from April 8-12 is “Saving for What Matters Most.”

“Supporting America Saves Week aligns with our office’s main priorities; bolstering retirement security and readiness, creating pathways to economic empowerment, and promoting a culture of financial excellence,” Treasurer Davis said. “By participating in this initiative, we can help individuals build strong financial foundations, reduce debt, and increase savings, ultimately leading to greater financial security and peace of mind.”

The Office of the State Treasurer will provide information on how people can create an effective savings plan by highlighting several key areas that contribute to financial stability. Each day of America Saves Week carries a specific theme:

• Monday, April 8 – Saving Automatically
• Tuesday, April 9 – Saving for the Unexpected
• Wednesday, April 10 – Saving for Major Milestones
• Thursday, April 11 – Paying Down Debt is Saving
• Friday, April 12 – Saving at Any Age

Delaware’s America Saves webpage (https://treasurer.delaware.gov/asw24) will be updated every day with information and tips about each daily theme.

“While America Saves Week provides a perfect time to take a close look at your finances and saving methods, we provide unique savings opportunities throughout the year,” Davis said. “Our office oversees the design, implementation, and overall administration the DE529 Education Savings Plan, DEPENDABLE, a savings plan for people with disabilities, and DEFER, the deferred compensation program for state employees. We’re also looking forward to the implementation of Delaware EARNS later this year. EARNS is a program that will bring retirement savings to those unable to get a retirement plan from their employer.”

Members of the Delaware General Assembly joined Treasurer Davis in promoting saving by proclaiming the week of April 8, 2024 “Delaware Saves Week” with the passage of Senate Concurrent Resolution 134 sponsored by Senator Nicole Poore and Representative Larry Lambert.

“Even a small cushion of savings can make a huge difference when it comes to helping our families overcome those unforeseen hurdles that life likes to throw in our way,” said Sen. Nicole Poore, the Senate prime sponsor of SCR 134. “That’s why I have worked closely with Treasurer Davis over the years to help our neighbors find ways to put some money aside for the future,” she said. “Whether we’re helping people with disabilities save for future expenses, making college a little more affordable for families or bringing retirement savings accounts to hundreds of workers, I am proud of the work we’ve accomplished to bring a little more financial security and peace of mind to our communities.”

“At a time when too many Delawareans are struggling to start their retirement accounts, save for their children’s education, or simply build up their nest eggs for emergencies, it’s so important that we spread awareness about the many great programs available to help residents save more for their future,” said Rep. Larry Lambert. “During Delaware Saves Week and every week, we must work to empower individuals with the resources and tools to secure their financial future.”

“I encourage everyone to take advantage of the resources available during America Saves Week and join the movement towards a financially secure future,” Davis said. “Together, we can build a more resilient and prosperous Delaware and America.”

Morningstar, the country’s most widely cited and influential investment plan rating group issued its annual report and upgraded the DE529 Education Savings Plan from Bronze to Silver status. Morningstar specifically credited the oversight of the plan as a major factor for the upgrade.

“Delaware earns an Above Average Parent rating driven by its multiple layers of oversight and engaged partners. The state’s 11-member plans management board, two subcommittees, and an external investment consultant review any recommended changes to the plan,” according to the report.

Delaware also saw an increase in its People Pillar score, a rating measuring the strength and weakness of an investment team. Morningstar noted, “It’s a topnotch group in the 529 space worthy of a People Pillar upgrade to High from Above Average.” The DE529 Education Savings Plan is managed by Fidelity Investments.

“We have seen tremendous growth in our 529 plan over the past year,” said Treasurer Colleen Davis. “With this ratings upgrade, continued quality oversight by the Plans Management Board, and superior plan management by Fidelity Investments, we expect to grow even more with hopes of reaching Gold status in the future.”

As of September 30, 2023, there were 2,149 new DE529 accounts opened this year, an increase of 41% over the same time last year.

Of the 54 529 plans offered throughout the country, only two have Gold status with just 15 more achieving Silver.

“We are thrilled to have our rating boosted by Morningstar,” said Donna Vieira, executive vice president and chief commercial officer for Sallie Mae who serves as Chair of the Delaware Plans Management Board, the entity that oversees the state’s investment programs. “Saving for college is an important step, and families should feel good knowing that industry experts see the DE59 Education Savings Plan as a sound investment and a safe place for their money.”

“There is no doubt the State’s commitment to the plan, including the General Assembly approving tax incentives for contributions to DE529 accounts helped grow our numbers and lead to our upgrade” Treasurer Davis said. “We’re proud to offer a good, competitive product to help people save.”

Click here to read “Morningstar 529 Ratings: The Best Plans of 2023.”

With Memorial Day falling on May 29th, we have the opportunity to remember the heroes of our past and take the opportunity to invest in the heroes of our future…our children. State Treasurer Colleen Davis once again joins the nationwide celebration of saving for higher education.

529 Day, which takes place every year on May 29th (5/29), is a day dedicated to promoting awareness and encouraging families to save for college through a 529 savings plan. These tax-advantaged investment accounts allow parents, grandparents, and other family members to save for a child’s education expenses, such as tuition, books, and housing.

“We believe that every child deserves the opportunity to pursue their dreams and achieve their full potential, and a DE529 savings plan can help make that a reality,” Treasurer Davis said. “I’m proud that our office sponsors the DE529 Education Savings Plan and takes the lead in raising awareness about the importance of saving for higher education.”

Contributions to DE529 accounts now come with additional benefits. “First State, First Steps” is an incentive program for Delawareans to start saving early. The pilot program provides for a $100 contribution to a DE529 Education Savings Plan account if:

• The beneficiary is five years of age or younger at the time of account opening
• The beneficiary is a Delaware resident at the time the account is opened
• A minimum contribution of at least $100.00 is made to the DE529 account when the account is opened.

Additionally, this year marked the first time that Delawareans filing their state tax returns could take deductions for DE529 contributions.

To help spread awareness of the DE529 Education Savings Plan, Treasurer Davis will host a community resource fair Thursday May 25, 2023, at the Wilmington PAL Center at 3707 North Market Street in Wilmington. The event is presented in partnership with Fidelity Investments, the Delaware NAACP, the Metropolitan Wilmington Urban League, the Police Athletic Club of Wilmington, and the UD Center for Economic Education and Entrepreneurship.

Members of the General Assembly joined in supporting education saving with the passage of HCR 47, sponsored by Rep. Krista Griffith and Sen. Trey Paradee, declaring May 29th DE529 Day in Delaware.

To learn more about 529 plans and how you can start saving for your child’s future, visit 529.delaware.gov.

A gift to a DE529 account will last well past the holiday season

The holiday season can be stressful as shoppers search for the perfect present. Opening a DE529 Education Savings Plan account or contributing to an already existing account lets you not only cross a gift off of your list but provide for the future as well.

“There’s no getting caught up in the frenzy of shopping malls and you won’t have to deal with supply chain issues when you give the gift of investing in a loved one’s future,” said Delaware State Treasurer Colleen Davis. “Saving for college never goes out of style like trendy fashion, so why not save instead of spending?”

According to the College Savings Plans Network, over $412 billion are being set aside all over the country for education expenses. In Delaware, $40.6 million were held in DE529 accounts as of the end of the third quarter of 2022.

The DE529 Education Savings Plan makes it easy and affordable to plan ahead for the cost of higher education at colleges & universities, technical & community colleges, trade schools, and many other post-secondary education programs. Sponsored by the State of Delaware and managed by Fidelity Investments, DE529 provides tax-advantaged accounts designed to help parents, grandparents and others pay for higher education expenses.

“You won’t pay any taxes on your money as it grows,” said Treasurer Davis, “plus, withdrawals for qualified higher education expenses like tuition, fees, and books are federal and Delaware income tax-free.”

Opening a new DE529 account for a child under the age of five makes your gift even bigger this year. “First State, First Steps” is an incentive program providing a $100 contribution to a DE529 Education Savings Plan account as long as the beneficiary is a Delaware resident, and the initial investment in the account is at least $100.

To learn more, visit 529.delaware.gov before making your holiday shopping list.

Act now to save money when filing your 2022 tax return next year

Thanks to a new law enacted by the Delaware General Assembly, Delaware taxpayers have new opportunities to save money.

Delawareans who save for school with the DE529 Education Savings Plan may qualify for a new tax deduction on their state returns.

“While our office oversees the management of the State’s investment portfolios, we also administer the DE529 Education Savings Plan which allows people to invest in the future of their loved ones,” said State Treasurer Colleen Davis. “Implementing a new tax deduction for DE529 contributions strengthens our commitment to helping people achieve a quality education without facing the possibility of years of student loan payments.”

Delaware tax filers are now eligible to deduct up to $1,000 of contributions to DE529 Education Savings Plans each year on their Delaware tax return (or $2,000 for joint returns) with a few additional conditions.

The deduction will NOT be available for:

• Tuition in connection with enrollment or attendance at an elementary or secondary public, private, or religious school
• Individuals with a federal adjusted gross income greater than $100,000 (or $200,000 for joint returns).

“The Department of Finance is pleased to announce that this tax benefit will be available for qualifying contributions made throughout 2022,” said Secretary of Finance Rick Geisenberger. “With the completion of a newly launched personal income tax module of the State’s Integrated Revenue Administration System (IRAS), considerable programmatic changes were made to enable administration of this new tax benefit for qualifying 2022 tax filers.” Official notice of the “go-Live” for these technology updates was published to the December 2022 Register of Regulations, thereby allowing the tax deduction for qualifying contributions to DE529 Education Savings Plans made after December 31, 2021.

The passage of House Bill 145 earlier this year also creates a tax deduction for contributions to a DEPENDABLE account for people with disabilities. The deduction applies to any amount up to $5,000 ($10,000 for couples filing a joint return).

“DEPENDABLE allows individuals with disabilities and their families save money above the $2,000 threshold that jeopardizes state and federal means-tested benefits,” said Treasurer Davis. “DEPENDABLE accounts allow people with disabilities to be able to work, able to save, and able to thrive.”

Those without a DE529 Education Savings Plan or DEPENDABLE account can take advantage of the tax deductions by opening accounts today at 529.delaware.gov or able.delaware.gov.