How It Works
Planning for college or training with VT529
For most families, saving enough to pay for the costs of higher education can seem overwhelming. However, with some planning, funding education after high school can be easier to achieve than you might think. Every dollar saved now for college or technical training is money you won’t need to borrow later on.
As Vermont’s official 529 college savings plan, VT529 is the only 529 college savings plan that qualifies for the 10% Vermont state income tax credit on annual contributions or gifts to your account.
What Is a 529 Plan?
A 529 plan is an education savings plan designed to help families set aside funds for future college costs, with tax advantages to help make saving easier. The plans are named after Section 529 of the Internal Revenue Code, which created these types of savings plans in 1996. Most 529 plans are operated by state agencies. Vermont’s 529 plan, the Vermont Higher Education Investment Plan (VT529), is sponsored by VSAC, the state’s higher education agency.
Who is VT529 for and where can funds be used?
A VT529 plan is a great opportunity for anyone planning to pursue education after high school. It can be used for a wide range of educational tracks – not just traditional college. With a VT529 account, you can pay for more than tuition. Funds may be applied toward qualifying costs such as computers, housing, meals, travel, and fees. You can even use your account to help repay student loans.
VT529 funds can be used at schools and programs across the U.S. and at hundreds of international institutions, including:
Traditional colleges and universities (undergraduate and graduate)
Trade schools
Technical training programs
Apprenticeships
Certificate programs
How to open an account
You can set up a VT529 account on the Vestwell platform in as little as 10 minutes. Before you begin, make sure to have the following information ready.
Your Social Security Number or Taxpayer Identification Number
Your beneficiary’s name, Social Security Number or Taxpayer Identification Number, birth date, and street address (not a P.O. Box)
Banking information if you want to fund your initial deposit or establish an automatic contribution plan from a checking or savings account
Picking an investment option
The investment option you choose may depend on what type of investor you are. A good place to start is to understand what risk is and to gauge your risk tolerance.
College Enrollment Year Portfolios
These all-in-one options offer diversified portfolios that automatically move to more conservative investments as the beneficiary approaches the targeted year of college enrollment. The age-based investment is by far the most commonly used investment type.
Static Portfolios
Static portfolio investments remain fixed unlike the college enrollment year portfolios which are automatically reallocated to more conservative investments.
Using your account
Adding money to an account
With the online platform powered by Vestwell, adding money to your account is simple and intuitive. Your bank account is securely connected to the VT529 Program account to protect your information. You can add money whenever you want, even $1 at a time.
There are many ways you can add money to build your savings, including:
One-time contributions
Recurring contributions
Payroll direct deposit
Savings Boosters
Rollovers
Gifting
Tax credits
Learn more about contributions
Withdrawing funds
You can withdraw a minimum of $5 online from your VT529 account to your bank account. All types of transfers usually take between 2-7 business days to complete and will appear as Vestwell on your bank account statements. When you make an electronic transfer to an institution, Flywire will appear on your bank account statement.
Low plan fees
VT529 has low plan fees and no enrollment fees. There is a low program management fee of 0.13% per year and low underlying investment fees between 0.00%-0.03% per year on the investments in your VT529 account.