Brilliant Baby CSAs
Brilliant Baby is providing each baby enrolled in the program with a Brilliant Baby College Savings Account (Brilliant Baby CSA). These accounts are set up as “529 college savings plans” with the Utah Educational Savings Plan. Once the baby’s account is set up, the Brilliant Baby program will deposit $500 into that account in order to help that child achieve his/her college dreams. Because it is held in an interest earning investment account, that $500 will grow over time, giving each Brilliant Baby a leg up in paying for higher education.
The Brilliant Baby CSA is designated to your child using your child’s personal information (including their social security number), but Brilliant Baby will own and manage the account until your child is old enough to use it. Families cannot deposit into the Brilliant Baby CSA, but we encourage families to save for their baby by setting up their own 529 college savings plan alongside of the Brilliant Baby CSA. If a family uses the Utah Educational Savings Plan to do this, they will be able to link that account to the Brilliant Baby CSA, and see all of their baby’s college savings in one place.
Brilliant Baby CSA FAQs
What is a 529 plan?
A 529 plan is a special type of savings account specifically designed to encourage early, affordable and consistent saving for college. While a person can save money for college in any type of account, 529 plans provide certain advantages for those who intend to save money for higher education.
What are the advantages of a 529 plan?
There are many benefits to a 529 plan. They include:
- In a 529 plan, all money grows federal and state income-tax free.
- All withdrawals used for qualified higher education expenses (including tuition, room and board, books and supplies, and fees) are exempt from federal income tax.
- Money saved in 529 plans are exempt from certain public assistance asset limits (including CalFresh, CalWorks, and most types of Medi-Cal), meaning money saved won’t count against the benefits that families receive.
- Unlike a regular checking or savings account, 529 plans are investments that can grow over time. This means that a small amount of money put away now can turn into a larger amount of money in the long run.
If you have more questions about 529s, visit the FAQs page of the UESP website.
Why is Brilliant Baby using the Utah Educational Savings Plan (UESP)?
UESP is a leader in helping families save for college. USEP has earned Morningstar’s top rating for the last six years. USEP’s fees are among the lowest in the industry. Families saving with UESP can open an account with $0 and deposit any amount they want. UESP also lets famalies see both their own account and the Brilliant Baby CSA linked together, showing them a picture of all college savings for their child. For more information about UESP, visit www.uesp.org.
Do you need a Social Security Number to sign up for a Brilliant Baby CSA?
Parents/guardians will need to bring their baby’s Social Security Number in order to sign up for a Brilliant Baby CSA. Parents/guardians do not need a Social Security Number of their own to secure a Brilliant Baby CSA for their child. If parents/guardians want to sign up for a family-owned 529 account, they will need either a Social Security Number or an Individual Taxpayer Identification Number (ITIN) for both them and their baby. If, for any reason, parents/guardians do not have or are unable to apply for a Social Security Number, Brilliant Baby can set parents/guardians up with a legal consultation about whether they should apply for an ITIN.
What other information should I have ready in order to sign up for a Brilliant Baby CSA?
Parents/Guardians should have the following ready when signing their children up for accounts:
- An Oakland mailing address
- Contact information (address, phone, email) for up to two adults connected to the account
- Their child’s name and date of birth
- Their child’s Social Security Number
How can families save their own money through Brilliant Baby?
Families cannot deposit into the Brilliant Baby CSA, but we encourage families to save for their baby by setting up their own 529 plan alongside of their Brilliant Baby CSA. If a family uses the Utah Educational Savings Plan to do this, they will be able to link that account to the Brilliant Baby CSA, and see all of their baby’s college savings in one place. Brilliant Baby program representatives can help with this.
When and how can the money be withdrawn and used?
The money in the Brilliant Baby CSA will remain in the account and grow until the child graduates from high school. When that happens, parents/guardians can request that the funds in their child’s Brilliant Baby account be transferred to a family-owned 529 held at USEP or paid directly to an eligible educational institution in the United States or abroad that participates in Federal student aid programs . For 529 plans that parents/guardians set up, money can be withdrawn at any time, although there is a tax penalty if that money is not used for the child’s higher education.