529 College Savings

Enter your child's current age, the existing balance in their 529 plan, and your planned monthly contribution.

The calculator projects the future value of the account and compares it against the estimated inflation-adjusted cost of a 4-year public or private university.

College costs have historically inflated at about 5% annually—faster than general inflation.

For high-income physicians, a 529 plan offers a major tax advantage: tax-free growth and tax-free withdrawals for qualified education expenses. Funding it early lets compound interest do the heavy lifting.

Future Value: FV = P(1+r)^t + C[((1+r)^t - 1) / r] where P is current balance, r is growth rate (assumed 6%), C is annual contribution, and t is years to college.

Cost Inflation: Cost = CurrentCost * (1+i)^t where i is inflation (assumed 5%).

• Pearl: Some states offer a state income tax deduction for 529 contributions. Check your state's rules, even if you invest in another state's plan.
• Pearl: You can "Superfund" a 529 plan by utilizing 5 years of the annual gift tax exclusion at once (currently up to $90,000 per parent).
• Pitfall: Overfunding a 529. If your child doesn't go to college or gets a full ride, withdrawing non-qualified funds incurs income tax and a 10% penalty on earnings (though new rules allow up to $35k to be rolled into a Roth IRA).