If you've ever hesitated to open a 529 education savings account or contribute more to one because you're not sure your child will go to a four-year university, you're in good company. It's a common concern for families.

Here's the good news: a 529 plan is not  limited to use for college. And over the past few years, the rules have expanded to cover more educational and career paths, including K-12 expenses, trade school, apprenticeships, professional certifications, and more.

When your child is young, you don't know yet whether they'll become a nurse, an electrician, a graphic designer, or something that doesn't have a name yet. With a 529 plan with The Education Plan®, you don't have to know. Here are eight ways your savings can be put to work.

1. College and university tuition and fees

The classic use, and still a big one. Tuition and required fees at accredited colleges and universities, including public or private, in state or out of state, in person or online, are qualified expenses. This includes tuition and fees for all degree types, including undergraduate and graduate degrees.  

2. Community college, trade school, and vocational programs

Two-year degrees at community colleges and trade schools. This includes programs for a wide range of trades, including welding, culinary arts, cosmetology, automotive tech, commercial driver's license (CDL) training, and many others. If the school is eligible for federal student aid, your 529 savings can help pay for it. These programs are often shorter in duration and can be less expensive than a bachelor's degree, which means savings can stretch further.

3. Housing and meals

Room and board is one of the largest expenses for many students in college. Your 529 savings can cover it, whether your student lives on campus or off. If they live off campus, your withdrawal is limited to what the school determines it would cost to live on campus; anything beyond that isn't qualified. One rule to know: Your student needs to be enrolled at least half-time for housing and meals (room and board) to qualify as qualified expenses.

4. Books, supplies, and equipment

Textbooks, lab materials, safety gear, notebooks, and anything required for coursework are qualified expenses. For a nursing student, that might mean a stethoscope. For a welding student, it might mean a helmet and gloves.

5. Computer or peripheral equipment and internet access

Computers and peripheral equipment, software required for classes, and internet service are all qualified expenses while your student is enrolled. What doesn't qualify: software for the purpose of entertainment (non-course work) and things like smartphones. There is a $10,000 per year limit for computer costs.

6. K-12 tuition and expenses

You don't have to wait until after high school graduation to use 529 savings. Families can withdraw up to $20,000 per year, per student, for K-12 expenses, including tuition and other expenses such as:

• Curriculum materials, books, and online instructional materials

• Tutoring and instructional classes (the tutor must be unrelated to your student and licensed, experienced, or a subject-matter expert)

• Standardized test fees, including Advanced Placement (AP) exams and college admissions tests

• Dual enrollment program fees, for high school students taking college courses

• Educational therapies for students with disabilities (occupational, behavioral, physical, and speech-language) from a licensed or accredited provider

One important note: States set their own tax rules, and not every state treats all  K-12 expenses as qualified. Check how your state handles it before you withdraw. K-12  expenses are considered a qualified expense in New Mexico. 

7. Registered apprenticeships

An increasing number of students are pursuing apprenticeships, and 529 savings can help. Fees, books, supplies, and required tools are all qualified expenses. The program does need to be registered under the National Apprenticeship Act.

8. Professional credentials and licenses

Your savings can now be used for recognized postsecondary credential programs. This is the kind of training that leads to a license or certification. Think plumbing, HVAC, IT certifications, real estate licensing, or the exams that come with becoming a certified public accountant (CPA). Qualified costs include tuition, fees, books, equipment, testing fees, and continuing education classes required to keep a credential current.

What if your child doesn't use all the funds in their 529 account?

There are many options! You can change the beneficiary to another family member, including a sibling, a cousin, or yourself. You can use up to $10,000 (a lifetime limit per borrower) to repay student loans for the beneficiary or their sibling. And if there's still money left over, you may be able to roll up to $35,000 into a Roth IRA in your beneficiary's name — a head start on retirement instead of an unused account. The Roth rollover has conditions: the account must have been open more than 15 years and the funds must have been in the account at least five years.

The money in a 529 account doesn't get stranded. It follows your child, or it can move to someone who needs it. Remember, there are no required disbursements. The funds can remain in the 529 account until you are ready to use them.

New Mexico families get an extra benefit

If you live in New Mexico and save with The Education Plan®, contributions to one of the state’s 529 plans, like The Education Plan, are eligible for deduction from New Mexico state taxable income. And there's no cap on the deduction. Combined with federal tax-free growth and tax-free withdrawals for qualified expenses, that's a meaningful advantage for keeping more of what you save.

Start with whatever you have

You don't need a plan for your child's entire future to start saving today. You just need a place to put the money, one that works no matter which direction they go.

You can sign up for an account in less than 15 minutes with many flexible contribution options. A little today really can go a long way.

This information is for general educational purposes and should not be considered financial advice or tax advice. We recommend consulting with a tax professional or financial advisor for personalized guidance.