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Are 529 plans only for my state's public colleges?
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529 Basics
Common Questions
- Does a 529 plan affect financial aid?
- Can I have 529 plans from multiple states?
- Can I use 529 plans outside of my state?
- What if I don't use my 529?
- Can I use 529 plans for K-12 tuition?
Are 529 plans only for my state's public colleges?
529 Basics
Common Questions
- Does a 529 plan affect financial aid?
- Can I have 529 plans from multiple states?
- Can I use 529 plans outside of my state?
- What if I don't use my 529?
- Can I use 529 plans for K-12 tuition?
There's a misconception that state-sponsored 529 plans are only geared to families that send their children to a state college. That's just not true!
There are two general types of 529 plans:
- 1. Savings programs
- 2. Prepaid programs
Savings
If you decide to use a 529 savings program, the full value of your account can be used at any eligible college or university including some international institutions. As of January 1, 2018, you can also use your 529 plan savings to pay for tuition expenses at private, public or religious elementary or secondary schools, up to $10,000 per year per beneficiary.
Prepaid
The states offering prepaid tuition contracts covering in-state tuition will allow you to transfer the value of your contract to private and out-of-state colleges (although you may not get full value depending on the particular state).
The tax law now permits higher education institutions to offer their own 529 prepaid programs. These will allow you to target your tuition prepayment to the sponsoring institution (or group of institutions). The Private College 529 Plan is the only such program currently in operation and you must check to see what restrictions they may place on the colleges covered by the plan.
Table of Contents
- What is a 529 Plan?
- Name the top 7 benefits of 529 plans
- Are there gift & estate tax benefits for 529 plans?
- How do I select the right investments for my 529 plan?
- Which is the best 529 plan available?
- Does a 529 plan affect financial aid?
- Can I have 529 plans from multiple states?
- Are 529 plans only for my state's public colleges?
- What is the penalty on an unused 529 plan?
- 529 savings plans and private school tuition

There's a misconception that state-sponsored 529 plans are only geared to families that send their children to a state college. That's just not true!
There are two general types of 529 plans:
- 1. Savings programs
- 2. Prepaid programs
Savings
If you decide to use a 529 savings program, the full value of your account can be used at any eligible college or university including some international institutions. As of January 1, 2018, you can also use your 529 plan savings to pay for tuition expenses at private, public or religious elementary or secondary schools, up to $10,000 per year per beneficiary.
Prepaid
The states offering prepaid tuition contracts covering in-state tuition will allow you to transfer the value of your contract to private and out-of-state colleges (although you may not get full value depending on the particular state).
The tax law now permits higher education institutions to offer their own 529 prepaid programs. These will allow you to target your tuition prepayment to the sponsoring institution (or group of institutions). The Private College 529 Plan is the only such program currently in operation and you must check to see what restrictions they may place on the colleges covered by the plan.
