Saver Success Spotlight: Haley Phillips Makes a Childhood Dream Come True
Haley Phillips: First Grade Teacher
School: University of New Mexico
Graduated: 2019
Degree: Education
“It feels great not having student loan debt. I can focus on my career and life after college without worrying about paying student loans for years.”
Picture this: A young girl is in her room, arranging dolls and stuffed animals in tidy rows. She prepares her lesson plan, assumes her place at the front of the class and begins to teach. The next day, unsatisfied with her passive pupils, she recruits her younger brother to join her class.
Meet Haley. She’s been a teacher at heart since arranging that first classroom of stuffed animals decades ago. She made it official this year when she took the helm of her first classroom of elementary school students in the Albuquerque Public Schools.
Haley’s grandmother, Trish, played a pivotal role in helping her attain her childhood goal of becoming a teacher. Back when Haley was still giving her stuffed animals English lessons, Trish opened a 529 account with The Education Plan for her. The account grew over the years and eventually paid for Haley’s bachelor’s degree in education from the University of New Mexico—and more.
“It was such a relief knowing that I could focus on college and not worry about how I was going to pay for it,” Haley says. I would have had a ton of student loan debt without my 529 savings.”
Haley’s 529 plan allowed her the freedom to focus on her education, hone her leadership skills as a recruitment coordinator for her sorority and participate in extracurriculars that helped her develop career skills like public speaking. It also helped her purchase the tools she needed to succeed.
“In addition to paying for tuition and fees, my 529 paid for my MacBook and iPad, she says. “I don’t know what I would have done without those tools to get me through. There’s no way I would have been able to afford to buy equipment in addition to paying for college without the savings from my 529.”
A Classroom of Her Own
Today Haley is figuring out her first year of teaching first grade, doing DIY craft projects at home and practicing yoga. She’s also considering opening a 529 account for herself to help pay for a master’s degree in education.
“It feels great not having student loan debt,” she says. “I can focus on my career and life after college without worrying about paying student loans for years. I recommend anyone who has kids or grandkids to start as early as you can and save often. Ask for gifts to your account from family and friends. Your loved one will be so grateful, like I am, for the gift of education and no debt.”
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
