New gift card allows people to give money to kid's college tuition

LOS ANGELES (KABC) -- Gift cards for retail shops and restaurants are common for special events such as birthdays and holidays, but now a first-of-its-kind card is available for college.

The college gift card, which allows friends and relatives to contribute to a person's college fund, can be another way for parents to save for their child's tuition. The way the card works is by directing the money to the child's 529 College Savings Plan.

California State Treasurer John Chiang said the sale for the cards begins this month.

Gloria Yvette Haring with Scholarshare said the earnings students make in the 529 will be able to be taken out tax free. The savings plans can be used in any state, even abroad, and are for any higher education institution, she added.

Juliana Gobin is a mother of two young boys and said the college gift card is more valuable than any toy they could ever receive.

"I feel like our family loves that idea, too. They feel really good knowing that they're helping us on this path to help (the kids) in the future," she said.

Chiang said the average student loan debt in the state is $30,000, which is a 4 percent increase from last year.

The gift cards are now available at all Toys "R" Us and Babies "R" Us stores, but you can also purchase them online.
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