529 Education Savings Plans

A 529 Plan is a tax-advantaged savings plan, operated by states or state agencies, designed to encourage saving for college expenses. This type of college savings plan generally allows you to establish an account for a student (the "beneficiary") for the purpose of paying the student's eligible college expenses including tuition and room and board. A 529 plan may have more flexibility on the amount you can contribute compared to other types of college savings plans.

Key benefits of a 529 plan:

  • There are generally no annual contribution limits (but there is typically a maximum balance the account can reach, set by the state).
  • There are no income limits for the accountholder.
  • Earnings in 529 plans are not subject to federal tax, and in most cases, state tax, as long as you use withdrawals for eligible college expenses.

Your First Citizens Securities Financial Advisor can help you choose among several investment portfolios for your contributions, including stock mutual funds, bond mutual funds and money market funds.

If you'd like to discuss your college savings needs with one of our Financial Advisors, e-mail us or call 1-866-931-1691.

First Citizens Securities is not a legal tax advisor and is not in the business of rendering tax advice. Any tax-related investment decisions should be made only after consultation with your tax advisor.

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