What’s the best way to save for college?
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When it comes to saving money for college, there are many options available—each with their own set of benefits. The best option for you depends on multiple factors, like your savings goals, risk tolerance and investment preferences.
WA529 Invest may check all the right boxes
529 plans are one of the most popular ways families choose to save for college. Other common methods include Roth IRAs or a standard bank savings account.*
WA529 Invest
1 - yes checkmark Tax-deferred growth
- yes checkmark Tax-free withdrawals for qualified education expenses
- yes checkmark Investment options
- yes checkmark No income restrictions
- yes checkmark No age restrictions for withdrawals
- yes checkmark High annual contribution limits
Roth IRA2
- yes checkmark Tax-deferred growth
- potential question mark Potential Tax-free withdrawals **
- yes checkmark Investment options
- no x Income restrictions
- no x Age restrictions for withdrawals
- no x Lower contribution limits
Bank Savings Account3
- no x No tax-deferred growth
- no x No tax-free withdrawals
- no x No investment options
- yes checkmark No income restrictions
- yes checkmark No age restrictions for withdrawals
- yes checkmark High annual contribution limits
Moreover, money saved in a 529 does not disqualify students for financial aid. 529 assets are typically treated as belonging to the parent (or grandparent, etc.) and count less in Expected Family Contribution (EFC) calculations than assets held in the child’s name.
Learn more at https://studentaid.gov/ or check with the schools you are considering.
Why choose WA529 Invest
- Can be used for expenses like tuition, fees, computers, textbooks, and room and board.
- With WA529 Invest, any growth you see over time won’t be subject to taxes down the line if used for qualified higher education expenses.
- WA529 Invest savings do not disqualify students from financial aid and count less in Student Aid Index (SAI) than assets held in the child’s name.4
Have any questions about ways to save for education? We have answers.
WA529 Invest compares favorably to other ways to save. A 529 plan can mean more flexibility and growth potential, including:
- Tax-free qualified withdrawals
- Low fees and expenses
- Easy-to-choose investment options
- Favorable financial aid treatment
- Use for a wide range of education expenses and programs—in Washington and around the world
Get more details and compare savings options.
No. Your WA529 Invest funds can be used at any eligible university in the country—and even some abroad. This includes public and private colleges and universities, apprenticeships, community colleges, graduate schools and professional schools.1 Up to $10,000 annually can be used toward K-12 tuition (per student).1 In addition, your 529 can be used for student loan repayment up a $10,000 lifetime limit per individual.1 Review a list of qualifying expenses and the state tax treatment of withdrawals for these expenses in the Program Details Booklet.
Footnotes
- 1Withdrawals for tuition expenses at a public, private or religious elementary, middle or high school, registered apprenticeship programs and student loan repayment can be withdrawn free from federal income tax. We encourage account owners to consult a qualified tax professional about how these withdrawals relate to their personal situations.↩
When you contribute to a WA529 Invest Plan account, any earnings are federal income tax-deferred until withdrawn. Then withdrawals used to pay for qualified education expenses are federal tax-free. State tax treatment varies. You should research what benefits may be available to you if you live in a state other than Washington.
