The Dime Daily

529 College Savings Calculator

By The Dime Daily Editorial Team · Published June 2025

Project how much your 529 college savings plan will grow from your balance, monthly contributions, and years until college. See tax-free compounding add up.

Skip the fluff — TL;DR

Starting with $5,000 and contributing $300/month for 14 years at 6% average return produces roughly $95,000 in your 529 — enough to cover most of an in-state public university education. Every year you wait costs more than you think.

5–7% is typical for age-based portfolios.

What is a 529 plan?

A 529 plan is a tax-advantaged savings account created specifically for education expenses. Contributions grow tax-free, and withdrawals for qualified education expenses — tuition, room and board, books, fees at eligible schools — are completely tax-free federally. Most states offer an additional deduction on 529 contributions on your state return.

You can use any state's 529, not just your own. Your child can attend any eligible school in any state. Starting in 2024, up to $35,000 in unused 529 funds (after 15 years) can be rolled into a Roth IRA for the beneficiary — eliminating most of the risk of "overfunding."

How much should you aim for?

School type4-year total cost (2025)50% coverage target
Public, in-state$110,000–$130,000$55,000–$65,000
Public, out-of-state$160,000–$190,000$80,000–$95,000
Private university$220,000–$280,000$110,000–$140,000

💰 Dime's Take

The 529 is one of the best deals in the tax code: tax-free growth plus a state deduction on top. The math is compelling at any contribution level. The biggest mistake people make is waiting until high school — starting at birth with even $100/month is dramatically better than starting at age 10 with $500/month. Open the account today.

Frequently asked questions

A 529 plan is a tax-advantaged savings account designed specifically for education expenses. Contributions are made with after-tax dollars, but the money grows tax-free and withdrawals for qualified education expenses (tuition, fees, books, room and board at eligible institutions, K-12 tuition up to $10,000/year) are completely tax-free at the federal level. Most states also offer a state income tax deduction on contributions. 529 plans are sponsored by states, but you don't have to use your state's plan or attend school in your state.

A reasonable rule of thumb is to aim to cover 50% of projected college costs, with the rest covered by financial aid, scholarships, work-study, and student income. At current average costs, four years at a public in-state university runs $110,000–$130,000 all-in; private universities run $220,000–$280,000. Starting a 529 at birth with $200/month invested at 6% average annual return produces roughly $75,000–$80,000 by age 18. That covers a large share of public university costs.

You have several options: (1) Change the beneficiary to another family member (sibling, cousin, even yourself) for their education. (2) Use the funds for K-12 tuition (up to $10,000/year). (3) Starting in 2024, unused 529 funds (after 15 years) can be rolled into a Roth IRA for the beneficiary, up to $35,000 lifetime. (4) Withdraw the money for non-qualified expenses — you pay taxes and a 10% penalty on the earnings only, not the contributions.

Most 529 plans offer age-based portfolios that automatically shift from aggressive to conservative as college approaches. A blended average return of 5–7% is commonly used for planning purposes — reflecting a stock-heavy portfolio in early years that gradually moves toward bonds and stable assets. The actual return depends entirely on which investment options you choose within your plan. Avoid using money-market funds for long-term 529 savings — inflation will erode purchasing power.
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