Americans lack awareness of 529 plans as they save for education, survey finds

A new survey has found that as Americans are saving for their kids higher education, they lack awareness of how 529 plans can help them.

According to research from Edward Jones, half of Americans (50 percent) don’t know what a 529 plan is and fewer than a quarter of them have a 529 plan. The survey, conducted by Morning Consult, found that only one out of every four adults (25 percent) know that 529 plans can be used to fund more than higher education. The primary barrier, the survey found, is a perception that savings or income are required to open a 529 account.

“Thanks to tax law changes over the past seven years, 529 plans are more useful and applicable than ever, and can often be used tax-free and penalty-free for secondary schools, technology purchases to further education and much more,” Andy Esser, an Edward Jones Financial Advisor in Durham, NC, said. “As a financial advisor and parent, I see first-hand the varying benefits of 529 funds – no matter what path a child may choose. Educating families on those benefits leads to more impactful results.”

Compared to 2023, the 13th annual survey found there has been a 6 percent increase in the number of adults (27 percent) who are more likely to consider saving for a vocational or trade school due to the impact of inflation/high interest rates. At the same time, only 22 percent are saving for the conventional four-year college path.

The survey was conducted between April 22-25 from a national sample of 2,202 adults over 18.

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