From plan requirements to managing your account, find the need-to-know answers to your biggest questions here.
Participating member schools
Which colleges and universities participate in the plan?
Nearly 300 private colleges and universities currently participate in the plan and are part of the CollegeWell network. The diverse range of colleges spans engineering schools, traditional liberal arts colleges, historically black colleges, religiously affiliated schools, research universities, women’s colleges and more.
Do I need to know where my child is going to college when I open an account?
No. You don’t need to know where they’re going when you open an account. Your prepaid tuition can be used at any current or future participating school, as long as the student is enrolled.
Since tuition is different at every college, what do my contributions buy?
Every dollar you contribute purchases Tuition Certificates that can be redeemed to pay for future tuition and fees at any of our participating schools.
The amount of tuition you purchase is based on the current rate of tuition at each participating school. The percentage of a year you purchase will vary by school, based on the tuition rates for the academic year in which your certificates are purchased.
For example, if Nancy contributes $10,000 to her account for 8-year-old Ben, that equals a third of a year of tuition at College A where current annual tuition is $30,000, and a quarter of a year at College B where current annual tuition is $40,000.
No matter how much tuition increases at Colleges A and B, Nancy will always own these percentages of tuition (33.33% at College A and 25% at College B).
Can I track my savings progress?
Absolutely! Your account statements report how much prepaid tuition you own to date for each of the sample schools you chose during enrollment. You can also log in to your account to track progress and access statements.
Will more schools be added to the plan?
Yes. We are always looking to grow our network of nearly 300 participating schools so you have more options.
Can I use my Tuition Certificates at a school that joins the plan after my purchase?
Yes. Schools that sign up to participate are required to honor Tuition Certificates that were purchased before the school signed on based on the tuition rate charged by that school for the academic year during which the Tuition Certificate was purchased. Participating schools guarantee Tuition Certificates for 30 years from the time of purchase, regardless of whether the school was a participating college at the time the Tuition Certificate was purchased.
Will the plan affect eligibility for financial aid?
If the parent is the account owner, there’s minimal impact on financial aid. Private College 529 Plan accounts are treated as parental assets, which have a smaller impact on federal financial aid than if the assets were those of the child. Currently, the federal financial aid formula considers no more than 5.6% of parental assets and 20% of student assets available to pay for college.
Individual institutions may consider parental assets in a different way when deciding how to distribute financial aid. Be sure to consult the college or university’s financial aid office and your tax advisor about your particular situation.
Can participating colleges stop participating in the plan?
Schools can choose to withdraw from participating in the Private College 529 Plan on a prospective basis only. Withdrawing schools are obligated to honor Tuition Certificates purchased any time before the school’s withdrawal.
How do I know that a participating college will honor my Tuition Certificates?
Our participating schools are legally required to accept Tuition Certificates for up to 30 years from the date of purchase.
How can I be sure my child is accepted and goes to one of these schools?
Our plan doesn’t guarantee acceptance or admission to any college or university, in network or otherwise. Nor does it impact the admissions process.
What happens if my child (the plan beneficiary) gets a scholarship?
If the plan beneficiary receives a partial scholarship, you can still use the Tuition Certificates to cover the remaining tuition costs.
If the plan beneficiary receives a full scholarship, you could designate a Qualified Alternative Beneficiary. Another option is requesting a withdrawal for an amount up to the value of the scholarship without incurring a penalty. The earnings portion of that withdrawal would be considered taxable income but not subject to the 10% penalty.
What happens if there’s money remaining in my account (not used by the beneficiary)?
You can change the beneficiary to another Qualified Alternative Beneficiary or roll the funds into a 529 savings plan and use the assets to pay for other expenses like room and board.
What if my children don’t end up going to participating schools?
If your children end up going to nonparticipating schools or not going to school at all, you have more than a few options for what to do:
- Change the beneficiary to another Qualified Alternative Beneficiary
- Roll over into a state-sponsored 529 plan
- Request a withdrawal**
Who can open an account for Private College 529 Plan?
Any U.S. person (including a trust) with a U.S. Social Security number or Taxpayer Identification Number can open an account. There are no income level requirements to enroll in our plan.*
What is a Tuition Certificate?
Tuition Certificates represent the amount of tuition you own at any of our participating schools. All contributions you make to your account during a Plan Year (July 1 through June 30) are aggregated into a single Tuition Certificate. If you make contributions to your account over multiple Plan Years, you will own multiple Tuition Certificates, one for each year in which you contributed to your account.
What can my Tuition Certificates pay for?
Tuition Certificates can be used to pay for undergraduate tuition and mandatory fees. Mandatory fees are set by colleges and universities, and in general, are required as a condition of enrollment. Neither tuition nor mandatory fees include or cover the cost of books, supplies or room and board.
Does the plan charge any fees?
No. There are no fees or additional costs. The participating schools pay the investment fees and operating expenses. So, every dollar you contribute goes to purchasing future tuition.
How much can I contribute to a Private College 529 Plan account?
Our maximum contribution limits are generous and change annually. The amount is equal to the cost of five years of full-time tuition at the most expensive participating college, which is currently $317,030 for the PC529 2021-2022 Plan Year. The maximum balance may be recalculated or adjusted each year based on the specific Plan Year’s most expensive participating institution.
Is there a minimum contribution amount?
Open an account with as little as $25. Contributions to the plan are flexible so you can save in a way that works for you. You can set up monthly, quarterly or annual automatic payments to make it easy or contribute as a lump sum from a tax refund, bonus, inheritance, etc. The plan requires you to contribute a minimum of $500 within the first two years of opening an account; otherwise, we will refund you the purchase amount without interest and the contract will be terminated.
If I want to save for multiple children, do I need an account for each child?
Yes, you would need an account for each child. By law, each 529 account can only be for one child (beneficiary). Create a new account.
How quickly can a Tuition Certificate be redeemed?
Tuition Certificates need to be held for 36 months from the issue date before they can be redeemed to pay for tuition at a participating school. The issue date is the first date during a plan year that a purchase of a Tuition Certificate is made.
How do I contribute to my plan?
As an account holder, you can make online contributions anytime.
- Log in to your account
- Select the FINANCIAL tab
- Make a One-time Contribution or
- Set up Automatic Contributions
How do I know how much tuition I own at participating schools?
Your account statement reports how much tuition you have prepaid and own at the five sample schools you designate. Log in anytime to update your schools and check on your account progress.
How do I make changes to my account?
Make changes by logging in to your account through the secure portal on our site.
Can other people contribute to my child’s account?
Absolutely! Grandparents, family and friends – anyone can contribute to your account. Simply log in and create an eGift event to invite and encourage family and friends to make financial gifts for holidays, birthdays and more.
How do I redeem a Tuition Certificate?
The redemption process is easy.
- Log in and select Redemption-Withdrawal
- Provide the name of the participating school
- Enter the amount of tuition and mandatory fees or the percentage of Tuition Certificate(s) you would like to redeem
You will receive confirmation from the plan, and the funds will be sent directly to the school.
What happens if an account owner or beneficiary passes away before a certificate is redeemed?
When opening an account, you must designate a beneficiary and appoint a successor owner. A successor owner assumes ownership of the account with all the rights of the original account owner in the unfortunate event that the original account owner passes away.
In the event of a beneficiary’s death, the account owner has two options:
- Designate a family member of the deceased beneficiary as the new beneficiary
- Request a refund**
In the case of a refund request, the one-year (12 calendar months) holding period for refunds is waived.
What is the withdrawal policy?
You may request a full or partial refund withdrawal of your account. Tuition Certificates must be held for 12 months before they are eligible to be withdrawn. The withdrawn value will generally be based on the amount contributed, adjusted for the net performance of the program trust, subject to a maximum increase of 2% per year and a maximum loss of 2% per year, compounded annually.
As with any 529 plan, if you do not use the money for qualified higher education expenses, any increase in the value of your initial purchase amounts (the difference between your contribution amount and the amount withdrawn) will be subject to federal income tax as well as an additional 10% penalty.
Are contributions to my Private College 529 account tax-deductible?
No. Contributions to 529 accounts (both state-run and Private College 529) for federal income tax purposes are made on an after-tax basis (e.g., similar to Roth IRA contributions). There is no federal tax deduction for contributions to a 529 account. However, earnings or gain in the account grow federal tax-deferred and if the earnings in the account are used to pay for qualified higher education expenses (e.g., tuition, fees, room and board, books and supplies) the gains and earnings are never taxed. Gains or earnings that are withdrawn to pay for non-qualified education expenses (expenses that are not tuition, fees, room and board, books and supplies, etc.) are subject to federal income taxes and a 10% penalty.
Many states do offer state income tax deductions or credits for contributions to 529 accounts. Often the benefits apply only to that state’s 529 plans. However, if you live in Arizona, Arkansas, Kansas, Minnesota, Missouri, Montana or Pennsylvania, you may be eligible to claim a state income tax deduction or credit for contributions to any 529 plan, including Private College 529. Consult your tax advisor for information specific to your situation.
What are the estate planning and gift tax benefits?
Like other 529 plans, Private College 529 Plan offers you significant estate and gift tax benefits.
Parents, grandparents, other relatives or even friends may contribute up to $16,000 ($32,000 for joint filers) per child each year, or up to $80,000 ($160,000 for joint filers) prorated over a five-year gift deferral period, to an account. This gift can be made without incurring a federal gift tax. If the contribution exceeds more than $80,000 ($160,000 for joint filers) in the five-year period, the excess would be a taxable gift in the year of contribution.
Contributions to 529 plans by the account owner are excluded from that account owner’s estate when taxes are assessed, even though the owner retains complete control of the account. If the account owner dies before the end of a five-year gift deferral period, a prorated amount will be added back into the estate. 529 plans are an attractive option for grandparents who seek tax advantages in estate planning. Consult your tax and legal advisors for information specific to your situation.
*An account may also be opened in the name of a trust or estate. Accounts opened in the name of a trust will require additional substantiation documentation, including a U.S. taxpayer identification number, to transact on the account. Further, in certain instances, accounts may be opened for unnamed beneficiaries (e.g., by an organization that is tax exempt under section 501(c)(3) of the Internal Revenue Code, that would award the Tuition Certificate to a scholarship recipient).
**You may request a full or partial withdrawal of your account. Tuition Certificates must be held for 12 months before they are eligible to be withdrawn. The withdrawn value will be based on the amount contributed, adjusted for the net performance of the program trust, subject to a maximum increase of 2% per year, and a maximum loss of 2% per year, compounded annually. The refund amount will be paid from the Program Trust only. As with any 529 plan, if you do not use the money for qualified higher education expenses, any increase in the value of your initial purchase amounts (the difference between your contribution amount and the amount withdrawn) will be subject to federal income tax as well as an additional 10% penalty.
See Disclosure Statement for details.