Average 529 Plan Balance: How Do You Compare?

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Kathryn Flynn

By Kathryn Flynn

December 22, 2023

According to the College Savings Plans Network, the average 529 plan balance hit a record $27,741 as of June 30, 2023. This amount is high relative to previous years but may need more to cover future education expenses. 

The amount you should have saved for your child’s college expenses depends on your child’s age and where they want to attend college. Once you determine the appropriate benchmark, you can determine if your college savings are on track.

Average college savings by age

Knowing the average 529 plan balance can be helpful, but a better comparison is to look at average savings by age. For example, if your child is heading to college soon, your 529 plan account balance should be much higher than a parent with a child in preschool.

Sallie Mae’s How America Saves for College 2018, their most recent publication for these statistics, reported the average amount American parents had saved for college by the age of their oldest child. Not surprisingly, parents with older children had more in savings.

Average amount saved for college
Age 0 – 6
Age 7 – 12
Age 13 – 17
Age 18+

Remember that 529 plans are investment accounts where earnings grow tax-free and are tax-free when distributions are used to pay for college. That means when stock prices rise, so does the value of a 529 plan. 529 plan account balances also increase due to contributions. The number of new accounts opened in a given year can also affect average 529 plan balances. Newer accounts tend to have smaller balances and, therefore, will bring down the average. 

It’s also important to remember that these are simply averages of what people have saved. Saving these amounts doesn’t guarantee adequate savings for your child’s education. So, let’s see how to determine how much you’ll need to save for your situation.

Savings benchmarks by type of college

First, it’s crucial to consider that college education costs will vary significantly by college. According to the College Board’s Trends in College Pricing, the average cost of tuition and fees for attending a 4-year private college in 2023-24 ($41,540) is about 269% more than attending a 4-year in-state public college ($11,260).

Regardless of which college you are saving for, you don’t have to save 100% of the sticker price. A good rule of thumb is to save 1/3 of projected college costs and cover the remaining 2/3 with current income, financial aid, scholarships, and student loans. The more you save, the less your child will have to borrow to pay for college. 

Another rule of thumb for college savings is to have $2,000 saved for each year of your child’s life. So, if your child is four years old, you should have at least $8,000 saved.

However, a rule of thumb like this is just a rough estimate. Consider using a college savings calculator for a more accurate estimate of the savings needed. A calculator allows you to add inputs based on the cost of college, current balances, future contributions, potential student aid, and rate of return assumptions. This will give you a much more accurate estimate of your savings needs and projected education savings.

For a four-year-old child’s college savings, our college savings calculator estimates that a monthly contribution of $309 (or about $3,709 per year) is needed to cover 100% of the cost of a 4-year in-state public college, which has an estimated total cost of $150,042.

How to get your college savings back on track

If you’ve fallen behind, the most obvious way to grow your college savings quickly is to contribute more to your 529 plan. 

  • If your college savings are below the benchmark, make a lump sum contribution to bring the balance up to the benchmark.
  • If you can’t afford a lump sum contribution, use a college savings calculator to see how much more you need to contribute each month to meet your goal. A good rule of thumb is to divide the shortfall by the remaining months and increase your monthly contribution by this amount. 

If you don’t have the means to save more, consider investing more aggressively to boost your return. 529 plans allow two investment changes per calendar year.

Review your 529 plan’s fees, expenses, performance rankings, and any income tax benefits offered by your state to make sure you’re getting the maximum value. If you’re unhappy with your current 529 plan, you can roll over to another 529 plan once in 12 months.

Contributions to a 529 plan also make great graduation, birthday, and holiday gifts. If friends and family ask for gift ideas, suggest that they give the gift of college. The Upromise rewards program is another way to boost savings. Members can earn cash back for college on qualified purchases and dining out.

At Savingforcollege.com, our goal is to help you make smart decisions about saving and paying for education. Some of the products featured in this article are from our partners, but this doesn’t influence our evaluations. Our opinions are our own.

A good place to start:

See the best 529 plans, personalized for you

A good place to start:

See the best 529 plans, personalized for you