529 Basics An Introduction to 529 Plans
Want to save for a loved one's education but have questions? Explore how a 529 plan can simplify education savings—and how you can take the first step today.
Start Saving NowKey Facts About 529 Accounts
A 529 college savings plan is a tax-advantaged account for education expenses, and is generally state sponsored.
Named after Section 529 of the IRS tax code, 529 college savings plans are a popular choice for their tax benefits, straightforward setup, and ease of use in covering a wide range of education expenses.
With CollegeCounts, you gain access to quality investment options.
Have questions before you start? That’s okay. We’re here with the answers you need.
Most Asked 529 Questions
How much should I save for college?
Prepare for your child’s or grandchild’s education by planning ahead and investing with the CollegeCounts 529 Fund. To calculate how much you’ll need to save before your beneficiary heads off to school, use our college savings planner to explore current tuition costs at colleges and universities nationwide, and estimate future expenses.
Who can open an account?
Whether you’re a parent, grandparent, relative or family friend, you can create an account to save for a loved one’s future education expenses. With no income restrictions or minimum contribution requirements, it’s easy to open an account. To get started, you need to be at least 19 years old, have a valid U.S. address, and provide a Social Security number or Individual Tax Identification Number (ITIN).
Who can contribute to a 529 fund?
Contributions to a 529 account aren’t limited to the account owner. Anyone—whether it’s extended family members or friends—can chip in to help save for a loved one’s future college costs. Contributors who are Alabama taxpayers may be eligible for an Alabama state income tax deduction for their contributions up to $10,000 each year.Footnote 1
What’s a beneficiary?
A beneficiary is the future student you’re saving for. You can open an account for a child, grandchild, friend, or even yourself. The beneficiary must have a Social Security number or Individual Tax Identification Number (ITIN).
What investment options are available with CollegeCounts?
CollegeCounts offers diverse investment options from a number of respected fund families, helping you save with confidence.
Choose from three portfolio categories tailored to your savings goals and preferences. If your investment strategy changes in the future, the IRS allows portfolio changes twice per calendar year or whenever you change your beneficiary.
With CollegeCounts, you can confidently select the investment approach that aligns with your goals. Start building a brighter future today.
How can I determine my risk tolerance and comfort level?
Determining your comfort with investment risk is a key step in building your college savings strategy. The way you divide your funds among stocks, bonds, and short-term investments should align with your tolerance for market volatility versus your desire for long-term returns.
Some investors are comfortable with greater market swings for higher growth potential, while others prefer more stability, even if it means lower returns.
Are you aggressive, conservative, or somewhere in between?
Our Risk Tolerance Questionnaire is designed to help you identify your position on the risk spectrum. This quick and easy tool provides asset allocation suggestions tailored to your input.
While no allocation guarantees meeting your investment goals, it offers valuable insights to guide your planning.
How and why is it beneficial to invest early?
By opening an account early with the CollegeCounts 529 Fund, as the days fly by, your investment will have the potential to grow right along with your child or grandchild. Starting sooner rather than later can provide peace of mind.
The benefits of higher education are priceless, so why wait? Opening a CollegeCounts account takes just minutes. With no minimum initial investment and no requirement for ongoing contributions, starting to save for college has never been easier.
Once your account is open, you can keep your savings on track by gradually increasing your contributions each year, regularly reassessing your investment strategies and goals, and making lump sum deposits from sources like work bonuses or the extra funds you free up after paying off a loan. Start today to build a brighter future.
529 Basics Webinar
Our free webinar, 529 Basics, Saving for College While Saving on Taxes, covers everything you need to get started on saving for college. Learn when to start saving, how much to save, how it will impact your taxes, and how to set up your account.