529 Contribution Calculator
Age-based portfolios shift to bonds as college nears; 5–7% early, less later
Four years of tuition, fees, room and board you want to cover
Published prices have risen roughly 3–5% a year
When college starts in 10 years
$67,358
covers 38% of the $177,629 that $120,000 of today's costs will grow to at 4% a year.
- You put in
- $46,000
- Investment growth
- $21,358
- Shortfall
- $110,272
- Monthly to fully fund
- $973
To close the gap, raise contributions to $973 a month, or add a lump sum of about $60,609 today on top of your current balance.
Balance versus target
Years across. Earnings are tax-free when spent on qualified education costs; non-qualified withdrawals pay income tax plus a 10% penalty on the earnings. Many states give a tax deduction for contributions, and up to $35,000 of unused money can roll into the beneficiary's Roth IRA under the SECURE 2.0 rules.
Project what a 529 college savings plan will hold when college starts, compare it with the future cost of college at your expected rate of tuition inflation, and find the monthly contribution or lump sum needed to close the gap.
Formula
Worked Example
Contributions of $46,000 grow by $21,358 to $67,358, but $120,000 of today's costs grows to $177,629 at 4% a year, so the plan covers 38%. Fully funding it would take $973 a month or about $60,600 more today.
Frequently Asked Questions
What can 529 money be spent on?
Qualified higher education expenses: tuition and fees, books, supplies, a computer, and room and board for students enrolled at least half time, at colleges, universities and many trade schools. Withdrawals for anything else pay income tax and a 10% penalty on the earnings, not on the contributions.
What happens to unused 529 money?
You can change the beneficiary to another family member, keep it for graduate school, or roll up to $35,000 over a lifetime into the beneficiary's Roth IRA under SECURE 2.0, if the account is at least 15 years old and within the annual Roth contribution limit.
Do 529 contributions get a tax deduction?
Not federally, but more than 30 states give a state income tax deduction or credit for contributions, usually only to their own state's plan. Growth is tax-free federally either way when spent on qualified costs.