Give the Gift of Education
Hunting down the perfect gift for a child in your life can be a stressful part of the holiday season. Squishmallows. Barbie’s Dreamhouse. A giant inflatable T-Rex?! These are among the most popular toys this holiday season, according to The Toy Insider. But while they may top wish lists, they often end up abandoned in a corner by spring and in the donation box by next Christmas.
This year, give the kids in your life a thoughtful, nontraditional gift that is unlike toys that are abandoned, forgotten or thrown away—the gift of education and a debt-free start to their adult lives. Whether for your own children, nieces and nephews, grandchildren or any young one in your life, a contribution to a 529 plan with The Education Plan® will be a gift that lives long past the holiday season.
With The Education Plan, you can gift as little as $25, making it a perfect fit for every budget. And because anyone can contribute to a 529 account with The Education Plan—from grandparents to friends to neighbors—it’s an easy way to wrap up holiday shopping for the kids in your life without the stress.
According to a recent 2022 Holiday Retail Survey, the average American household will spend nearly $1,500 on holiday gifts in 2022, with parents spending about $276 on each child’s gifts. Setting aside some of that budget for a gift contribution to their 529 plan is a meaningful way to show them that you believe in them and their dreams for the future. Making a gift contribution a holiday tradition can also be a great way to talk about their future dreams and the importance of saving for higher education every year.
Asking for a 529 Gift
For parents of young children, the holiday season often brings toy overload. Asking loved ones for a 529 gift contribution in lieu of more traditional gifts is an easy way to think outside the toy box and invest in their future. Not only can a 529 gift contribution assist your children with less debt, but it’s also a great way to ‘crowd-fund’ their education. You can even download and print one of these gift certificates so you have something to wrap and put under the tree or tuck into a stocking.
Setting up your 529 account to accept gifts is easy with Ugift. The system generates a unique code that you can share with loved ones to contribute to your child’s 529 quickly and easily.
How to Set Up Gifting With Your Account
- Login to your account with The Education Plan.
- Click on the Ugift icon.
- Follow the steps to generate your unique Ugift code.
- Share your code with loved ones and direct them to this page to give a gift.
It’s a great idea to set this up before any occasion, particularly birthdays, holidays, baby showers, and graduations. With gift contributions going into a plan from a few different people, a few times a year, education savings can really add up!
Log in to your Account and click the Ugift icon to get started.
Frequently Asked Questions
A 529 plan is a tax-advantaged investment account that is designed to grow savings for future education expenses for a specified beneficiary. 529 plans offer unique benefits and features that make them an appealing strategy for education related saving.
A 529 plan can be used for “qualified educational expenses.” For federal tax purposes, qualified educational expenses include:
- Tuition and fees at accredited higher education institutions
- Books
- Supplies and equipment
- Room and board for beneficiaries attending on at least a half-time basis.
- Computer technology, equipment, and internet access
- Up to $10,000 a year for K-12 tuition and expenses (Limit increase to $20,000 in 2026)
- Expenses for educational special needs services
- Transfers to an ABLE account for the beneficiary (transfer subject to annual limit)
- Apprenticeship expenses
- Up to $10,000 for student loan repayment
- Credentialing expenses and certification programs
- Roth IRA rollover for the beneficiary
If you're not sure if an expense is considered "qualified," we recommend consulting with a tax professional or advisor. Unqualified expenses will be treated like ordinary income: state and federal taxes will apply, with a 10% federal penalty for withdrawals from your 529 plan used to pay for them.
New Mexico residents can deduct contributions to The Education Plan from their state taxable income each year. This includes contributions made to an account that you are not the account owner of.
You cannot deduct contributions from federal income taxes.
Any person at least 18 years old with a valid Social Security Number (SSN) or Tax Identification Number (TIN) can open a 529 account. The account holder chooses the investment options, designates a beneficiary, and requests the distribution of funds.
The cost of college continues to rise, including tuition, housing, food and supplies, so it’s important to begin saving as soon as possible. You can learn more about how much a typical college education costs on our Cost of College page. It’s never too early or too late to start.
The Education Plan offers a variety of investment options to fit you and your family’s needs, risk tolerance and goals. You can see all of the available investment portfolios on the investments page.
Yes, you can use up to $20,000* a year to cover tuition and expenses for K-12 education.
Qualified K-12 expenses include:
- Tuition (public, private, and religious)
- Curriculum materials, books (including digital/online) and instructional materials
- Tutoring and instructional classes**
- Fees for a nationally standardized norm-referenced achievement test, an advanced placement examination, or any examinations related to college or university admission
- Dual enrollment program fees
Educational therapies for students with disabilities provided by a licensed or accredited practitioner or provider, including occupational, behavioral, physical, and speech-language therapies
*Starting in tax year 2026. The annual limit is $10,000 in tax year 2025 and permitted for tuition only.
**Tuition for tutoring or educational classes outside of the home, including at a tutoring facility, but only if the tutor or instructor is not related to the student and—
(i) is licensed as a teacher in any State,
(ii) has taught at an eligible educational institution,
or (iii) is a subject matter expert in the relevant subject.
You can open an account with The Education Plan online or by mailing in the enrollment form. In order to open an account, you will need the following information:
- Your social security number or TIN
- Your address
- Your bank account information (in order to fund the account)
- The beneficiary’s social security number or TIN
- The beneficiary’s birthday
-The beneficiary’s address
