Parents – Plan for their Future
Get real answers to your concerns about saving for college.

Parents will provide many gifts to their children, including family values and ideals. One of the most important gifts a child can receive is a college education – and it may also be the most expensive. Assuming just a 6% annual increase in college expenses, 18 years from now, the cost of the same year of college could increase three-fold. SMART529 Select can help you bridge that gap. 


Save Your Way

SMART529 Select offers a variety of investment portfolios designed to provide for a range of risk tolerances and time horizons.1 These savings can be used at thousands of eligible higher education institutions nationwide and internationally, including accredited colleges, universities and trade schools. Even if your child receives a tuition scholarship, your SMART529 Select savings can be used to cover other qualified expenses. And since anyone can contribute to a SMART529 Select account, the sooner your family starts saving, the more likely you’ll be able to reach those goals.

  • Automatic Investment Program – provide the dollar amount and frequency of your contributions and they will be transferred electronically from the bank or credit union account you specify to your SMART529 Select account.
  • Payroll Direct Deposit – deduct monthly directly from your paycheck and deposit into your SMART529 Select  account. Your employer must support this feature so ask your Human Resources representative.
  • For West Virginia Residents, an account may be opened with an initial investment of $50 per Account and there are no minimum requirements for subsequent investments.
  • Withdrawals for qualified higher education expenses are free from federal income tax, as well as West Virginia personal income tax.2
  • Save for qualified education expenses including tuition, fees, room and board, computers and supplies required for attendance.

Saving Now Could Mean Less Debt Later

Giving your grandchild the gift of higher education may also help you reduce your estate and save on estate taxes. If a third party is the designated beneficiary on your SMART529 Select account, the value of the account will not be included in the donor’s estate for estate tax purposes. The only exception would occur if you are spreading a gift out over five years for gift tax purposes, in which case the gifts allocable to periods after your death are included in your estate.3

Contributing even small amounts of money allows time and tax deferral to do their job. The chart below demonstrates the advantage of starting early. As you can see, when it comes to investing for college, time can be your greatest asset.


Taxable vs. Tax-Free

Assumes initial $10,000 deposit, $150 monthly investment thereafter, 8% hypothetical annual rate of return  


Child's Age 1 Year
1 year old child
6 Years
6 year old child
12 Years
12 year old child
Taxable: $80,084 $51,806 $27,240
Tax-Free: $100,352 $60,803 $29,639
Time to Save: 17 Yrs. 12 Yrs. 26 Yrs.

The hypothetical 8% annual rate is not guaranteed and does not reflect the performance of a particular product or investment option. Actual results will vary. For purposes of this illustration, the taxable investment returns reflect taxation at a hypothetical 24% tax bracket. However, lower maximum tax rates on capital gains and dividends would make the investment return for the taxable investment more favorable, thereby reducing the difference in performance between the amounts shown. Changes in tax rates and tax treatment of investment earnings may also impact results. Tax-deferred investments carry fees and charges that are not reflected in the hypothetical performance. If they had been reflected, the ending value would be lower. Earnings on non-qualified distributions are subject to ordinary federal income tax rates, and may be subject to an additional 10% federal income-tax penalty. Distributions may also be subject to state income tax and penalties under certain circumstances which is not illustrated in this hypothetical chart. Consider your personal investment horizon and income tax bracket, both current and anticipated, when making an investment decision, as they may further impact the results of the comparison.

1 Investment returns are not guaranteed and you could lose money by investing in the Plan.

2 Non-qualified withdrawals are taxable as ordinary income to the extent of earnings, and also may be subject to a 10% federal income tax penalty and a withdrawal charge. Such withdrawals may have state income tax implications.

3 Any additional gifts to the same beneficiary in that 5-year period would be subject to federal gift tax. If the donor elects to treat the gift as being made over 5 years, and the donor dies prior to the end of that 5-year period, the portion of the gift allocable to the period after the donor's death will be included in the donor's estate. Estate tax treatment may differ by state. Please consult your tax advisor for more information.