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College Savings Benefits

Tax-free Earnings, Contributions and Withdrawals1
  • Earnings may grow federal tax-deferred and may be withdrawn federal tax-free when used for qualified education expenses. State tax varies.2
  • No federal gift tax on contributions you make for a beneficiary up to $12,000 in one year, with the total maximum contribution limit of $200,000 per beneficiary.3
You Control the Account
  • The account owner, not the beneficiary, maintains indefinite control of how the money is used.
  • The account is transferable among family members. You can name another child or family member, including siblings, spouse, cousins and even yourself, as account beneficiary should the original beneficiary choose not to attend college or receives a scholarship.
Flexible Spending
  • Your money may be used at any accredited school, including private or public colleges, universities, occupational or trade schools, graduate programs, even some foreign schools.
  • Money can be used for "qualified education expenses," including tuition, fees, books and other supplies, equipment, and room and board.
  • There are no income, age or residency requirements and no minimum annual contribution requirements.
Professional Money Management
  • Choose from a full range of mutual funds based on your risk tolerance or the length of time until your child starts college.

1 The availability of tax or other benefits may be conditioned on meeting certain requirements, such as residency, purpose for or timing of distributions or other factors.

2 By investing in a 529 plan outside of your state of residence, you may lose any state tax benefits. Non qualified withdrawals are subject to federal and state income tax and a 10% penalty. 529 plans are subject to enrollment, maintenance, management fees and expenses. Contact your tax advisor for details.

3 Although the maximum amount of contributions differs from state to state, in the majority of states offering college savings plans, the maximum amount that you can contribute for a beneficiary exceeds $200,000.

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