529 Basics
Dream big with 529 plans
There’s more than one pathway to career success, but all require training and education. Paying out of pocket can be a challenge, and loans can saddle you or your child with substantial debt. 529 plans can help you start saving today.
Fast facts about 529s
Understanding 529 Plans
A 529 savings plan is a type of investment account that can be used for education savings. These accounts can be opened by almost anyone, there are no income limits, and anyone can contribute. A 529 account works much like a Roth IRA by investing your after-tax contributions into investment portfolios like a mutual fund.
529s are also very flexible, allowing you to use your savings at in-state, out-of-state, public, or private schools. This includes community colleges, trade schools, graduate programs, and some international schools. You can even use a 529 plan to save for K-12 tuition, registered apprenticeship programs and certain student loan repayment.
Education savings made simple
529 plans provide a flexible and affordable way to save for the future. The top reasons to save with a 529 plan include:
Tax benefits help your savings grow faster
Save for education and save on your taxes. Earnings grow free from state and federal taxes and are never taxed when used for qualified higher education expenses.
The money you save is always yours
If your plans change, or your student earns a scholarship, you can withdraw your original investment, although you may be subject to taxes or penalty on investment earnings.
Minimal impact on financial aid
A 529 account will generally affect federal financial aid, but the overall impact is usually minimal and will vary based on who owns the account.
Save for more than just tuition
Use your account for many other qualified higher education expenses like housing, meal plans, books, computers and much more.
Learn more about 529s
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1This chart is for illustrative purposes only and is not intended to reflect actual performance of any specific investment. Assumes interest rate of 6.25 percent compounded monthly. The value of your Invest529 account will vary depending on market conditions and the performance of the investment option you select, and it may be more or less than the amount you deposited. You could lose money – including the principal you invest – or not make money if you invest in one of these programs. Past performance of investments is not an indicator of future returns.