Higher Education Flipbook_2023

Tax-Advantaged Savings: 529 Plans & ESAs Two types of tax-advantaged plans are specifically designed to help families save for higher-education expenses: the 529 savings plan and the Coverdell Education Savings Account (ESA). Although contributions to these plans are not tax deductible, withdrawals — including any earnings — are free of federal income tax if they are used to pay qualified highereducation expenses, including tuition, fees, room and board, books, and supplies. 2021 2022 Total number of accounts 14.8 million 15.1 million Total account assets $452 billion $388 billion Source: ISS Market Intelligence, 529 Market Highlights, Q4 2021 & Q4 2022 A greater proportion of college savings are held in 529 savings plans than in any other savings vehicle. 529 savings plans Source: Sallie Mae, 2022