Parents

Saving for college now can give your child a head start on the path to future success.

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Investing in the Direct Plan means you can:

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Save on taxes—and lower the cost of college

With the Direct Plan, you benefit from tax-deferred earnings as well as tax-free withdrawals for qualified higher-education expenses.* And since you're paying less in taxes, you can save more, which lowers the total cost of college.

If you're a New York State taxpayer, you can also deduct contributions on your state income tax return.**

Start saving at any time

Whether you have a toddler or a teen, it's never too early or too late to save for higher education.

Take on less debt

The more you can put aside for college now, the fewer loans you and your child may have to take out later on. Saving rather than borrowing also makes your overall college cost much lower.

Choose any eligible school

Your child can attend any eligible higher-education institution, not just a 4-year college or university. This includes vocational and trade schools, as well as community colleges and graduate schools.

Decrease financial aid impact

Unlike other types of accounts, such as a custodial account under the Uniform Gifts/Transfers to Minors Act (UGMA/ UTMA), a 529 plan account is generally considered part of the parents' assets, not the child's. So it will have much less impact when it comes to financial aid eligibility.

Change your beneficiary if needed

If your child doesn't use the money in the account, you can choose an eligible family member, such as one of your other children, or even yourself, to be the beneficiary without paying a penalty.