529 Plan Calculator: Growth, Earnings and State Tax Savings
This 529 plan calculator projects how a 529 education savings account grows from your current balance and monthly contributions, how much of the final balance is investment earnings, and what your own state's deduction could be worth.
State tax savings apply only if your state lets you deduct 529 contributions. Enter your own state's rate and yearly limit. Rules differ by state, and there is no federal deduction.
A 529 plan calculator projects the future value of a 529 education savings account. It compounds your current balance and monthly contributions at an assumed annual return, separates what you paid in from investment earnings, and estimates any state income tax deduction, so you can compare the result with the college cost you want to cover.
How This 529 Plan Calculator Works
The account is grown month by month, with each contribution added at the end of the month. The year-by-year table is that same calculation, and it matches this formula:
Formulas
Future value = B × (1 + r/12)^n + C × ((1 + r/12)^n - 1) / (r/12)
Earnings = Future value - (B + C × n)
Where B = current balance, C = monthly contribution, r = annual return, n = number of months.
- State tax savings = yearly contributions (up to your state's deduction limit) × your state income tax rate × years. It is zero unless you enter a rate.
- Target check: if you enter a target college cost, the calculator shows the surplus or shortfall and the monthly contribution that would reach the target exactly.
The 7% return is a starting assumption, not a forecast. Investment returns are not guaranteed and plan fees reduce them.
Worked Example: $300 a Month for 18 Years
A parent opens the account with $5,000 and adds $300 a month for 18 years (216 months) at a 7% annual return. Their state taxes income at 5% and allows the full contribution to be deducted.
| Step | Calculation | Result |
|---|---|---|
| Starting balance grows to | $5,000 × 1.005833216 | $17,563 |
| Monthly contributions grow to | $300 × 430.721 | $129,216 |
| Future value | $17,563 + $129,216 | $146,779 |
| Total paid in | $5,000 + $300 × 216 | $69,800 |
| Investment earnings | $146,779 − $69,800 | $76,979 |
| State tax savings | $3,600 × 5% × 18 years | $3,240 |
If the same state capped the deduction at $2,000 a year, the saving would be $100 a year, or $1,800 in total. Against a $120,000 target the account ends $26,779 ahead, and $238 a month would have been enough to reach the target exactly.
529 Plan Rules and Limits for 2026
Federal rules are the same in every state. These figures come from the IRS (Topic 313, Publication 970, the Form 709 instructions and Rev. Proc. 2025-32).
| Rule | What applies in 2026 |
|---|---|
| Federal deduction | None. Contributions are not deductible on a federal return |
| Earnings | Grow tax free, and come out tax free when used for qualified education expenses |
| Other withdrawals | The earnings portion is taxable income and generally carries a 10% additional tax |
| Gift-tax annual exclusion | $19,000 per giver for each beneficiary |
| Five-year election | Up to $95,000 contributed at once can be treated as given evenly over five years, elected on Form 709 |
| K-12 expenses | Up to $20,000 a year per beneficiary (the limit was $10,000 through 2025) |
| Student loan repayment | Up to $10,000 over a lifetime per individual |
| Rollover to a Roth IRA | $35,000 lifetime limit for the beneficiary; the 529 account must be open at least 15 years; direct transfer only; each year's amount counts toward the annual IRA limit ($7,500 for 2026); contributions from the last five years are not eligible |
| Contribution limit | No annual federal dollar limit. Each plan sets its own maximum balance |
State Tax Deductions for 529 Contributions
There is no federal deduction for 529 contributions, so any up-front tax saving comes from your state. The SEC's investor bulletin on 529 plans notes that many states offer tax benefits for contributions, such as a state income tax deduction or matching grants, that these come with restrictions, and that you may qualify only if you use the plan sponsored by your state of residence. Limits, and whether a deduction exists at all, differ from state to state. That is why this calculator asks for your own state's tax rate and yearly limit instead of assuming one. If your state has no income tax or no deduction, enter 0.
How Much Should You Save in a 529?
Start from the cost you want to cover. At the College Board's 2025-26 average published prices for tuition, fees, housing and food, four years cost about $103,400 at an in-state public four-year college ($25,850 a year) and about $243,680 at a private nonprofit college ($60,920 a year), before financial aid and before future price increases. The college savings calculator inflates those prices to your child's enrollment year and works out the monthly saving needed. Enter that figure here as the target to see whether your 529 contributions are on track.
Investment Strategies for 529 Plans
Education savings plans typically offer a menu of investment options. According to the SEC, these often include static portfolios with a fixed mix and age-based portfolios, sometimes called target-date portfolios, which shift toward more conservative investments as the beneficiary approaches college age. Fees and expenses vary by plan and lower your returns, so compare them before choosing. Run the calculator with a lower and a higher return to see how much the outcome depends on that one assumption.
Last updated: October 2026. Sources: IRS Topic 313, IRS Publication 970 (2025), Instructions for Form 709 (2025), Rev. Proc. 2025-32, IR-2025-111, SEC Investor Bulletin on 529 plans, College Board Trends in College Pricing and Student Aid 2025.
Frequently Asked Questions
What is a 529 plan?
A 529 plan, legally a qualified tuition program, is a tax-advantaged account for education savings sponsored by a state or an educational institution. Contributions are not deductible on a federal return, but earnings grow tax free and withdrawals are tax free when used for qualified education expenses.
What can 529 funds be used for?
College costs such as tuition, fees, books, supplies, computers and internet access, plus room and board for students enrolled at least half-time. From 2026, up to $20,000 a year per beneficiary can go to K-12 expenses such as tuition, books and tutoring. Registered apprenticeship costs and up to $10,000 of student loan repayment over a lifetime also qualify.
What happens to unused 529 funds?
You can change the beneficiary to another member of the family with no income tax, or keep the account for graduate school. The beneficiary can also roll up to $35,000 over a lifetime into their own Roth IRA if the 529 account has been open at least 15 years, the transfer is direct, and each year's amount stays within the annual IRA contribution limit ($7,500 for 2026).
How much can I contribute to a 529 plan?
There is no annual federal dollar limit, but contributions cannot exceed what is needed for the beneficiary's qualified education expenses, and each plan sets its own maximum balance. For gift tax, a giver can contribute up to $19,000 per beneficiary in 2026 within the annual exclusion, or up to $95,000 at once by electing on Form 709 to spread it over five years.
Do 529 plans affect financial aid?
Less than most assets. In the federal aid formula, a 529 plan held for a dependent student is reported as a parent investment, and parent assets are assessed at no more than about 5.64%. Student-owned assets are assessed at 20%.
Can I use any state's 529 plan?
Yes. The IRS confirms you are not restricted to your own state's plan. However, a state income tax deduction or credit is often available only if you use the plan sponsored by your state of residence, so weigh that benefit against each plan's fees and investment options.
How much will a 529 plan be worth in 18 years?
It depends on your contributions and returns. As an example, $300 a month for 18 years on top of a $5,000 starting balance grows to about $146,779 at a 7% annual return: $69,800 paid in and $76,979 of earnings. The return is an assumption, not a guarantee.
Are 529 contributions tax deductible?
Not on a federal return. Many states offer a deduction or credit for contributions, usually with a yearly limit and often only for the home state's plan. Enter your own state's tax rate and limit in the calculator to estimate the saving, or enter 0 if your state has no deduction.