529 Plan Calculator
Plan ahead for education costs with our free 529 plan calculator. Enter your current savings, monthly contributions, expected returns, and time horizon to see how much you will have when college starts and how many years of tuition it will cover.
A 529 plan is a tax-advantaged savings plan designed to encourage saving for future education costs. Named after Section 529 of the Internal Revenue Code, these plans are sponsored by states and educational institutions. Contributions grow tax-free, and withdrawals are also tax-free when used for qualified education expenses including tuition, room and board, textbooks, and even K-12 tuition up to $10,000 per year.
The key advantage of a 529 plan is tax-free compound growth. By starting early, you give your investments more time to compound. For example, saving $300 per month at a 7% return for 18 years accumulates approximately $130,000, of which about $65,000 is investment earnings that will never be taxed. Many states also offer a state income tax deduction for contributions.
This calculator assumes a 5% annual tuition inflation rate when estimating how many years of college your savings will cover. Tuition has historically risen faster than general inflation, so planning conservatively is wise. Consider increasing your contributions annually to keep pace with rising education costs. Most financial advisors recommend shifting to more conservative investments as your child approaches college age to protect your accumulated savings.