Frequently Asked Questions

Get answers to frequently asked questions about 529 plans, The Education Plan, and ways to save for education.

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A 529 plan typically has a minimal effect on financial aid, but it varies by situation. Federal financial aid is a needs-based award and is determined by the cost of attendance (the total amount school will cost for one year) and the expected family contribution (based upon the income and assets of both the parents and the student).

A 529 plan does not count as an asset of the beneficiary. If a 529 plan is held by the parents, it does count as an asset of the parents. If the 529 plan is owned by someone else, such as a grandparent, the 529 plan does not count as an asset of the beneficiary. However, the amount withdrawn from a 529 plan owned by someone else, such as a grandparent, is considered income of the beneficiary when it is withdrawn on the beneficiary’s behalf. This may impact any potential financial aid in following years

Many students and their families use student loans. But saving using a 529 plan can help students finance a debt-free education. Student loans need to be paid back, while 529 plans offer the opportunity to save as little or as much as you like.

Qualified higher education expenses for federal tax purposes include:

  • Tuition and fees
  • Books
  • Supplies and equipment
  • Room and board for beneficiaries attending on at least a half-time basis.
  • Computer technology, equipment, internet access
  • Expenses for educational special needs services*
  • Up to $10,000 a year for K-12 tuition*
  • Transfers up to $15,000 a year to an ABLE account for the beneficiary*
  • Apprenticeship expenses*
  • Up to $10,000 for student loan repayment*

*If you are a New Mexico taxpayer, New Mexico and the federal government currently have different definitions for “qualified higher education expenses” for tax purposes. See “Important Notice to New Mexico Taxpayers”

To make a withdrawal from your account with The Education Plan, download our withdrawal request form or contact us at 1-877-337-5268, Monday through Friday, 8:00 a.m.– 7:00 p.m. MT.

The cost of college continues to rise, including tuition, housing, food and supplies, so it’s important to begin saving as soon as possible. It’s never too early or too late to start.

There are several types of savings options available:

  • 529 plans
  • UGMA/UTMA
  • Coverdell Education Savings Accounts (CESAs)
  • Series EE Savings Bonds
  • Taxable Savings Accounts

Yes. A 529 plan can be used for four-year colleges and universities, vocational school, community college, some foreign institutions, and qualified kindergarten through 12th-grade tuition (non-qualified in NM).

Yes. The account owner can roll over funds from one 529 plan to another with certain limitations. If you are a current account owner, download our rollover form.

Any person over 18 with a valid Social Security number may open an account. The account holder selects the investment options, the beneficiary, and requests the distribution of funds.

Any person with a valid Social Security number can be the beneficiary of a 529 plan. The beneficiary and the account owner don’t need to be related. An account owner can open a 529 plan for themselves or a family member or friend.

 

An account owner may change the beneficiary at any time. There are no tax consequences if you change the beneficiary to a family member of the current beneficiary. However, you should consult with your tax professional regarding your specific circumstances.

The Education Plan offers a practical way of approaching education savings. Plan highlights include:

  • Streamlined portfolio options: Our enhanced investment menu features fewer, yet more diversified options. Enrollment year-based portfolios help make choosing a suitable investment strategy easier.
  • Expertise: Ascensus College Savings Recordkeeping Services, LLC (Ascensus College Savings) manages The Education Plan. With over 4.5 million accounts administered, Ascensus brings a wealth of experience to help improve your saving experience.
  • Lower cost: Our total asset-based fees are just 0.10-0.44%.
  • Gifting opportunities: We offer access to Ugift and Upromise. Ugift allows you to easily and securely share your 529 plan account information with family, friends and coworkers, giving them the opportunity to make gift contributions online. Upromise lets members earn back a percentage of qualified spending, which can be deposited into their 529 account.
  • Flexibility: you can open an account with just $1 and contribute what you want, when you want. Account changes, contributions and withdrawals are easy to manage online and beneficiaries and ownership are transferable.

A 529 plan is a tax-advantaged education investment plan designed to grow savings for future education expenses for a specified beneficiary. 529 plans offer unique benefits and features that make them a very appealing strategy for education planning that can significantly reduce the burden of student loan debt.

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The Education Plan® and The Education Plan® Logo are registered trademarks of The Education Trust Board of New Mexico used under license.

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Phone: 1-877-337-5268
We're available Monday to Friday 8 a.m. to 7 p.m. MT

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For more information about The Education Plan, call 1.877.337.5268 or view the Plan Description and Participation Agreement, which includes investment objectives, risks, charges, expenses, and other important information; read and consider it carefully before investing.

Please Note: Before you invest, consider whether your or the beneficiary’s home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in that state’s qualified tuition program. You also should consult a financial, tax, or other advisor to learn more about how state-based benefits (or any limitations) would apply to your specific circumstances. You also may wish to contact directly your home state’s 529 plan(s), or any other 529 plan, to learn more about those plan’s features, benefits and limitations. Keep in mind that state-based benefits should be one of many appropriately weighted factors to be considered when making an investment decision.

The Education Plan is administered by The Education Trust Board of New Mexico. Ascensus College Savings Recordkeeping Services, LLC, the Program Manager, and its affiliates, have overall responsibility for the day-today operations, including investment advisory, recordkeeping and administrative services. The Education Plan’s portfolios invest in: (i) mutual funds; (ii) exchange traded funds; and/or (iii) a funding agreement issued by New York Life. Investments in The Education Plan are not insured by the FDIC. Units of the portfolios are municipal securities and the value of units will vary with market conditions.

Investment returns will vary depending upon the performance of the portfolios you choose. You could lose all or a portion of your money by investing in The Education Plan depending on market conditions. Account owners assume all investment risks as well as responsibility for any federal and state tax consequences.

Ugift is a registered service mark of Ascensus Broker Dealer Services, LLC.

The Education Plan® and The Education Plan® Logo are registered trademarks of The Education Trust Board of New Mexico used under license.

All other marks are the exclusive property of their respective owners.

Not FDIC-Insured. No Bank, State or Federal Guarantee. May Lose Value.