TN 529: The Ultimate Plan for Your Child's College Education

In Tennessee, planning for your child's future is made easier with TN 529, the state's official college savings plan. With over $850 million invested by more than 170,000 families, TN 529 is a safe and reliable way to save for college expenses.

Benefits of TN 529

• Tax-free growth: Earnings in a TN 529 account grow tax-free, federally and in Tennessee.
• Tax-free withdrawals: When used for qualified college expenses, withdrawals are tax-free, federally and in Tennessee.
• Low investment minimum: You can start saving with as little as $25.
• Flexible investment options: Choose from a variety of investment portfolios tailored to your risk tolerance and time horizon.

How TN 529 Works

TN 529 is a 529 plan, which is a tax-advantaged savings plan designed specifically for education expenses. Anyone can contribute to a TN 529 account, including parents, grandparents, friends, and family. Contributions are invested in a variety of investment options, and earnings grow tax-free. When the beneficiary is ready for college, withdrawals can be used to pay for qualified expenses, including tuition, fees, books, and room and board.

Types of TN 529 Accounts

There are two types of TN 529 accounts:

• Direct-Purchased Plan: You can open a direct-purchased plan with any of the program's approved investment providers.
• Advisor-Guided Plan: This type of plan is managed by a financial advisor who can provide personalized investment advice.

Investing in TN 529

Choosing the right investment options is essential to maximizing the growth of your TN 529 account. The program offers a variety of portfolios, ranging from conservative to aggressive. You should select a portfolio that aligns with your risk tolerance and time horizon.

Withdrawals from TN 529

Withdrawals from a TN 529 account are tax-free, federally and in Tennessee, if used for qualified college expenses. Qualified expenses include tuition, fees, books, supplies, equipment, computer technology, and room and board.

TN 529 Contributions

Anyone can contribute to a TN 529 account. Contributions can be made in the form of cash, checks, or electronic transfers. The annual contribution limit is $500,000 per beneficiary.

TN 529 Investment Performance

The TN 529 investment portfolios have performed well over the years. According to the College Savings Plans Network, the Direct-Purchased Plan has had an average annual return of 6.99% over the past 10 years.

TN 529 and Financial Aid

TN 529 does not affect a student's eligibility for financial aid. In fact, withdrawals from a TN 529 account are not considered income for the purposes of federal financial aid eligibility.

FAQs About TN 529

Q: Who can open a TN 529 account?
A: Anyone can open a TN 529 account, including parents, grandparents, friends, and family.

Q: What is the minimum investment for a TN 529 account?
A: You can start saving with as little as $25.

Q: How do I choose the right investment options for my TN 529 account?
A: You should select a portfolio that aligns with your risk tolerance and time horizon.

Q: How do I make withdrawals from a TN 529 account?
A: Withdrawals can be made online, by phone, or by mail.

Q: Does TN 529 affect a student's eligibility for financial aid?
A: No, withdrawals from a TN 529 account are not considered income for the purposes of federal financial aid eligibility.

Q: What happens if my child does not attend college?
A: If your child does not attend college, you can withdraw the money in the TN 529 account, but you will be subject to income tax and a 10% penalty on the earnings.

Conclusion

TN 529 is a smart and affordable way to save for your child's college education. With tax-free growth, tax-free withdrawals, and flexible investment options, TN 529 is the perfect plan to help you reach your college savings goals.