You Should Be Investing in a 529 Now for Your Kids' or Grandkids' Tuition

The sooner you start, the more money you’ll have for your child’s education.

A drawn image of a graduation cap with a price tag attached.
(Image credit: Getty Images)

Year after year, the cost of higher education continues to climb, and many parents face the troubling prospect that expenses could increase significantly more by the time their kids get to college. Investing in a 529 college-savings plan offers tax and financial aid benefits, and it gives your savings the opportunity to grow in the stock market.

A 529 plan is a state-sponsored college education savings account. Withdrawals are tax-free as long as the money is used for qualified educational expenses, which include tuition and fees, books, supplies, and room and board. In addition, two-thirds of states offer an income tax break for contributions to the state’s 529 plan.

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Emma Patch
Staff Writer, Kiplinger's Personal Finance

Emma Patch joined Kiplinger in 2020. She previously interned for Kiplinger's Retirement Report and before that, for a boutique investment firm in New York City. She served as editor-at-large and features editor for Middlebury College's student newspaper, The Campus. She specializes in travel, student debt and a number of other personal finance topics. Born in London, Emma grew up in Connecticut and now lives in Washington, D.C.