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For most parents looking for a way to save for their child’s college education, a 529 college savings plan is a wise choice. That’s because the money you invest in one of these accounts grows tax-free if you use the funds toward eligible education expenses.
Individual states offer 529 plans. Below you’ll find a searchable map where you can find details for each state’s plan, along with its rating from our data partner, Savingforcollege.com. You’re not required to use your state’s plan; we’ve only included in our rankings the top-rated plans that consumers in any state can access.
None
High contribution limit
None
High contribution limit
Also managed by Fidelity, New Hampshire’s 529 plan offers the same reasonable fee structure as Massachusetts’ plan, though its maximum contribution limit is significantly higher. In fact, it’s the highest contribution limit on our list, which makes it helpful if your child attends graduate school in addition to undergrad. Since New Hampshire doesn’t collect state income tax, there is no state tax break through the plan.
Eligibility: Account owner must be a U.S. citizen or permanent resident; funds can be used at any eligible educational institution
Contribution amounts: No minimum; maximum allowable balance of $522,000 per beneficiary
Tax benefits available: None; New Hampshire does not charge state income tax
Fees: No enrollment, application or maintenance fees; program management fee of 0.09% to 0.2% depending on investment funds chosen, including state fees
Up to $10,000
annual tax deduction
Low fees
Up to $10,000
annual tax deduction
Low fees
New York’s 529 plan comes with a low flat-fee structure: All participants pay an annual program management fee of 0.13% of the account balance and no other fees. Participants can deduct up to $5,000 in New York State taxable income per year as an individual and up to $10,000 per year as a married couple filing jointly.
Eligibility: Account owner must be a U.S. citizen or permanent resident, of any age; funds can be used at two-year or four-year colleges, graduate schools or vocational or technical schools
Contribution amounts: No minimum; maximum allowable balance of up to $520,000 per beneficiary
Tax benefits available: For New York taxpayers only, up to $5,000 annual deduction for individuals ($10,000 for married couples filing jointly)
Fees: No enrollment, application or maintenance fees; program management fee of 0.13%, including expenses for investment funds chosen
Up to $20,000
annual tax deduction
Generous tax benefit
Up to $20,000
annual tax deduction
Generous tax benefit
Illinois’ 529 plan offers features that make it attractive for both in-state and out-of-state residents. Like the other plans on our list, funds can be used at any college, not just those in Illinois, and its fees are on the lower end. Most notably, Illinois residents get a generous state tax deduction of up to $10,000 to $20,000 per year, depending on their tax filing status.
Eligibility: Account owner must be a U.S. citizen or legal resident; funds can be used at any higher education institution that participates in federal student aid programs
Contribution amounts: No minimum; maximum balance of $450,000 per beneficiary
Tax benefits available: For Illinois taxpayers only, up to $10,000 annual deduction for individuals ($20,000 for married couples filing jointly)
Fees: No enrollment, application or maintenance fees; program management fee of 0.105% (including 0.03% state administrative fee)
Up to $2,000
annual tax deduction
Low fees
Up to $2,000
annual tax deduction
Low fees
The U.Fund College Investing Plan, offered by the Massachusetts Educational Financing Authority and managed by Fidelity, comes with low fees, but also one of the lower maximum contribution amounts. The state tax deduction for Massachusetts taxpayers is also not as generous as other states’ plans provide, but may be worthwhile for certain in-state residents.
Eligibility: Account owner must be a U.S. citizen or permanent resident; funds can be used at any accredited college
Contribution amounts: No minimum; maximum allowable balance of $400,000 per beneficiary
Tax benefits available: For Massachusetts taxpayers only, up to $1,000 annual deduction for individuals ($2,000 for married couples filing jointly)
Fees: No enrollment, application or maintenance fees; program management fee of 0.09% to 0.2% depending on investment funds chosen, including state fees
Up to $4,000
annual tax deduction
Generous tax benefit for single filers
Up to $4,000
annual tax deduction
Generous tax benefit for single filers
Ohio’s 529 plan comes with features in line with the other plans on our list, including low fees, a range of investment options and a tax deduction for Ohio taxpayers. The deduction is not as generous as other states offer, though, especially for married couples. The plan also comes with a minimum contribution, both to open the account and for each contribution thereafter. But it is small ($25) and likely manageable for many plan participants.
Eligibility: Account owner must be a U.S. citizen or permanent resident; funds can be used at any higher education institution that participates in federal student aid programs
Contribution amounts: $25 minimum contribution; maximum allowable balance of up to $482,000 per beneficiary
Tax benefits available: For Ohio taxpayers only, up to $4,000 annual deduction for both individuals and married couples filing jointly
Fees: No enrollment, application or maintenance fees; 0.13% program management fee plus 0.02% state fee
Up to $300
annual tax credit
Matching scholarship program available
Up to $300
annual tax credit
Matching scholarship program available
Oregon’s 529 plan provides flexibility and a wide range of investment choices. There is a $25 minimum initial contribution, but only a $5 minimum for subsequent contributions. Fees, however, are higher than some other plans charge. Tax benefits also are relatively minimal, though they come in the form of a dollar-for-dollar tax credit rather than a deduction from taxable income.
The plan is also unique in that it offers a program match, in which Oregon College Savings Plan beneficiaries who choose specific in-state schools receive a scholarship to attend.
Eligibility: Account owner must be a U.S. citizen or legal resident; funds can be used at any qualifying higher education institution
Contribution amounts: $25 minimum initial contribution, then at least $5 per contribution per investment portfolio; maximum allowable balance of $400,000 per beneficiary
Tax benefits available: For Oregon taxpayers only, up to $150 annual tax credit for single filers and $300 for joint filers, depending on annual plan contribution and income
Fees: No enrollment, application or maintenance fees; 0.25% state administrative fee, plus investment fees for funds chosen
Despite their advantages, only 29% of college-saving parents use 529 plans, according to Sallie Mae’s 2018 report “How America Saves for College.” In many cases, parents could end up with more money saved by using a 529 plan rather than, or in addition to, a general savings account.
But since there are many 529 plans to choose from, the decision can be complex. First, take note of whether your state offers a tax break for choosing the local plan. Then calculate how much it could be worth to you based on your expected 529 plan contributions, income and filing status. Vanguard, Fidelity and other sources offer online 529 state tax benefit calculators. If you’re not getting meaningful savings—or another state’s plan offers substantially lower fees or broader investment choices—you’re not bound to using your own state’s plan.
When you’re comparing 529 plans and underlying investments, also check the total annual fee you’ll be charged, including not only management and state fees but the costs of the investment portfolios themselves. Some 529 plan websites make that easy to do, while others may not; be sure to ask if the plan costs aren’t clear. Fees can reduce your investment earnings, and while some fees are inevitable, understanding how much they add up to will help you compare plan options.
Some states offer two types of 529 plans: one sold by the state directly to consumers and one sold by financial advisors only. In each case where a state offered both types, the direct-sold plan was higher-rated based on Savingforcollege.com’s analysis. As a result, we’ve included only direct-sold plans on our list.
Some 529 plans also provide useful consumer-friendly features that might be important to you, like an online platform where friends and family can make a contribution to your child’s plan. Look into the perks and extras available from your state’s plan.
The best 529 plans listed here received five-star ratings for both in-state and out-of-state residents on Savingforcollege.com. The rating system on Savingforcollege.com takes into account each plan’s investment performance history, fees, extra features and reliability.
While you don’t have to choose your state’s plan, more than 30 states provide a tax break on contributions (usually—though not always—for residents only). Nearly all of our top-rated plans provide state tax benefits to residents, but they also offer enough features and cost savings to appeal to non-residents who don’t qualify.
The biggest reasons to consider a 529 plan are the structured savings and the tax benefits. Merely having a specific college savings vehicle could encourage you to save more than you would have otherwise. And choosing a 529 plan rather than a traditional savings account gives you the benefit of tax-free growth on investments and a potential state tax break.
Some consumers may be concerned about the possibility that investing for college could lead to losses on your contributions, rather than earnings. But it’s best to start saving in a 529 plan early, when your child is as young as possible. That gives your money more time to grow. Additionally, plans typically offer age-based investment portfolios, which help balance your investments based on how close your child is to college, potentially lowering your risk.
Money in 529 plans must be used to pay for qualified education expenses, which gives you less flexibility than if you’d saved in a brokerage account or savings account. You can always take the money out to pay for expenses other than education, but you’ll pay federal income tax and a 10% penalty to do so.
You have other options, however, if your child doesn’t go to college or gets a scholarship that covers their expenses. For example:
Brianna McGurran is the Loans Analyst for Forbes Advisor. Most recently, she was a staff writer and spokesperson at NerdWallet, where she wrote "Ask Brianna," a financial advice column syndicated by the Associated Press. As spokesperson, she also contributed her expertise to outlets including The New York Times, ABC World News Tonight and the Today Show.