What is a 529 plan?

A 529 plan is a tax-advantaged savings account designed to be used for the beneficiary's education expenses. Use the money in your 529 for a wide range of college expenses at accredited schools nationwide in addition to tuition expenses for K-12, certain apprenticeship costs, and student loan repayments. 1

What is a private college 529 plan?

The Private College 529 Plan is a separate prepaid plan for private colleges sponsored by more than 250 private colleges. Educational institutions can offer a prepaid tuition plan but not a college savings plan. The first education savings plan was a prepaid tuition plan: the Michigan Education Trust (MET) was created in 1986.

What are the different types of 529 plans?

There are two main types of 529 plans: Education savings plans and prepaid tuition plans. Education savings plans offer tax-deferred growth, and withdrawals are tax-free when used for qualified education expenses. These plans remain under the control of the donor, usually a parent.