529 Plan Contribution Limits

Course: Fundamentals of Financial Planning
Lesson 6: Educational Savings Techniques

Student Question:

Good morning,

Do the limits on 529 Plan contributions apply to that specific account, the child, or the contributor? Is it possible for a contributor to have more than one 529 Plan if they’ve reached the limit on one?

Thanks,

Aaron

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Instructor Response:

Hi Aaron,

Good question.  It’s going to be based on the beneficiary, but it’s also only limited per state.  So, for example, if the maximum allowable 529 balance amount in Oregon is $300,000, then you could have three different $100,000 529 accounts for the benefit of 1 child.  You just can’t have the total of the 3 accounts exceed the state limit.

However, you could then open another account in Virginia and max out the account(s) there based on the Virginia limits.  So, if the maximum amount in Virginia was $400,000, you could then have $700,000 of 529 accounts for the benefit of 1 child  — $300,000 between the 3 accounts in Oregon and $400,000 for the 1 (or more) accounts in Virginia.

Does that help clarify?

Dan

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