Flip the Coin: Rethink the Way You Save for Education.

Two approaches to planning for tomorrow.

Just like a coin, there are two sides to saving for the future. On one side are short-term goals, such as building an emergency fund. To cover immediate needs, many families use a traditional savings account. It’s a secure and accessible place to keep your money.

On the other side of the coin are long-term goals, like saving for your child’s education. And that requires a different approach. Savings accounts are built for stability, with minimal potential for your money to grow over time, unlike investing in a specialized 529 plan like Embark.

Compound interest matters.

Traditional savings accounts have modest interest rates, often making about 0.05% annually. That means for every $100 in your savings account, you’d earn about $.05 in interest a year. But investing is different. With Embark you could earn more than 5% in interest, and unlike with other kinds of investment accounts, you won’t pay taxes on the gains. Plus, the earned interest in your account today can also earn interest tomorrow.

It can be hard to visualize a regular savings account versus a 529 plan, so here’s an example: Let’s say you want to save $30,000 to pay for your child’s freshman year of college.

• With a traditional savings account, you’d need to save $140 a month starting when your child was born.
• On the flip side, with Embark, you’d need to save an estimated $85 a month over that same period.

Starting early is important.

When you’re planning for something big, many people feel like they should wait until they can begin with a big chunk of savings. But when it comes to investing, time does the heavy lifting. Small contributions gain power over time, as the interest adds up and grows on itself. So while waiting to save may feel fine today, it can actually cost you a lot of money in the long term.

Here’s another example: Let’s say you want to save $10,000 for your kid to go to trade school.

• If you start saving with an Embark account when your child is born, you’d need to save about $30 a month. And of that amount, $6,400 would be the funds you saved, and the other $3,600 would be interest earned.
• If you waited until your kid was nine years old to start saving, you’d need to contribute $75 a month. Of that, $8,100 would be the funds you saved, and only $1,900 would be interest earned.

While the math can feel complicated, the result is clear. Starting early, even with small contributions, gives your money time to grow.

Tax benefits make an impact.

While other 529 plans can help your funds grow, Embark gives families who live in Oregon an extra boost. You can earn an annual, refundable income tax credit worth up to $380. That means your contributions could help in more ways than one — growing your savings for the future while potentially putting money back in your pocket each year you contribute.

See how Embark stacks up.

Check out how reinvesting an annual $380 Embark tax credit can boost your savings.

A few more saving details.

1. Do I need a lot of money to get started?
   Nope! You can open an Embark account with as little as $25. And starting with small, consistent contributions can lead to meaningful growth over time.
2. What is the difference between a savings account and a 529 plan?
   While a savings account is good for short term goals, a 529 plan is designed to help you save for education and more effectively grow funds over time with tax advantages.
3. How are funds invested with Embark?
   With different portfolio options to choose from, you can decide how your money is invested to meet your family's financial goals.