NY 529 Direct Plan highlights
Here's a quick look at the many ways you can benefit when you save with the Direct Plan.
Take advantage of our benefits and options
Flexible use of savings
- Save for a child, grandchild, friend—or even yourself.
- Use at any eligible 2- or 4-year college or university, vocational or technical school, or graduate school in the United States or abroad.
- When used for higher education expenses at eligible educational institutions, money can be used to pay for tuition, certain room-and-board expenses, books, supplies, and the expenses for the purchase of certain computer equipment, software, and computer-related services.
- Grow your earnings tax-deferred.
- Pay no federal taxes on qualified withdrawals.* (Note: federal qualified expenses are different than New York state qualified expenses. Please consult the Program Description for more information)
- Contribute up to $85,000 in a single year ($170,000 if married filing jointly) for each beneficiary, without incurring federal gift taxes as long as you don't make any other gifts to that same beneficiary for five years.**
More tax benefits for New York taxpayers
- Pay no state taxes on qualified withdrawals.* (Note: federal qualified expenses are different than New York state qualified expenses. Please consult the Program Description for more information)
- Deduct up to $5,000 ($10,000 if married filing jointly) in contributions to the Direct Plan on your state income tax return each year.***
Open an account with any amount you choose – there is no minimum contribution amount.
- NY's 529 Direct Plan has some of the lowest costs available for 529 plans. You pay only $1.20 in fees per year for every $1,000 you invest in the plan (0.12% total annual asset-based fee).
- No advisor fees, commissions or account maintenance fees, which other plans may charge.
Option to open another account for the same child
The same child can have multiple accounts opened for him or her. So even if mom and dad have already opened an account, a grandparent or other family member or a friend can open another one. Combined contributions to these accounts can total as much as $520,000.
Convenient ways to contribute
- Sign up for payroll deduction (if available through your employer).
- Set up recurring contributions.
- Contribute through electronic bank transfer.
- Mail a check.
Trust the experts
- Recordkeeping and related services for the Direct Plan are managed by Ascensus.
- Professional investment management is provided by Vanguard.
Diverse investment options
- You can choose from among 20 Target Enrollment Portfolios, in which target allocations of the Portfolio automatically adjust to more conservative allocations as your Beneficiary approaches the date they are expected to enroll in school or an eligible program.
- Choose from among our 14 individual portfolios that let you design and manage your own investment strategy.
Invest regularly with recurring contributions
One of the easiest ways to contribute to your Direct Plan account is to establish recurring contributions (also known as an automatic investment plan or AIP), which are set amounts that you contribute to your account at regular intervals.
You can set up recurring contributions when you open an account or at any time afterward.
Save more with Ugift
Ugift is a simple, secure way to invite family and friends to help your children save for higher education by giving them the gift that keeps on giving—contributions to their Direct Plan account. Gift givers can make online contributions. To make this even easier you can get a Ugift code when you log on to your account and share that code with family and friends through Twitter or by email.
For those who prefer to contribute by check, you can print Ugift coupons, which can be sent in by mail with contributions.