New York 529 Plan: What College Savers Should Know
Credit: Image Credit: gregobagel / iStock / Getty Images PlusAccording to the Federal Reserve, New York held about $40.2 billion in 529 plans in June 2022.[1] That’s the second-largest 529 balance in the country.
529 college savings plans help people save for college by investing in the stock market and waiting for their investments to grow. Anyone can enroll in a New York 529 plan. State residents can take advantage of certain tax benefits for participating.
Learn more about New York’s 529 offerings and tax deduction below.
New York 529
New York offers two college savings plans. One is advisor-guided. That means you have access to a financial advisor who can help you make investment decisions. This plan comes with slightly higher fees.
New York’s 529 College Savings Program
- Requires State Residency? No
- K-12 Expenses Eligible? No
- Fees: 0.12%
- Performance Notes: The moderate growth portfolio has gained 5.76% in average annual returns since its creation.
New York’s 529 Advisor-Guided College Savings Program
- Requires State Residency? No
- K-12 Expenses Eligible? No
- Fees: 0.28-1.99%
- Performance Notes: The Class A moderate growth portfolio has gained 7.75% in average annual returns since its creation, not including its sales charge.
Behind the Numbers
As with any investment in the stock market, 529 savings fluctuate over time. We updated our performance notes in January 2023.
In addition, New York 529 plans include multiple portfolios, including investment options based on your beneficiary’s age. If you’re interested in investing, check out the different portfolios to see which option is right for you.
New York 529 Tax Deduction
According to the College Savings Plan Network,[2] state residents can deduct annual contributions to a New York 529 plan on their taxes.
- Single residents can deduct up to $5,000.
- Married residents who file jointly can deduct up to $10,000.
New York residents can contribute up to $520,000 in total to college savings plans.