Information from the Washington State Department of Financial Institutions

529 college savings plans

What is a 529 college savings plan?

A 529 plan is a tax-advantaged savings plan designed to encourage saving for future education costs. 529 plans, legally known as “qualified tuition plans,” are sponsored by states, state agencies, or educational institutions and are authorized by Section 529 of the Internal Revenue Code.

Under these plans, you contribute after-tax money and your money grows tax-free, and all withdrawals are tax-free, when used for tuition, room and board, and other qualified higher education expenses.

There are two types of 529 plans: prepaid tuition plans and education savings plans.

  • College savings plan: You pick your investments and shoulder the investment risk. The value of your account is based on the performance of your investments. When it's time for college, you have whatever money is in your account.
  • Prepaid tuition plan: You prepay for college tuition today for use in the future. The value of your account is guaranteed by the state to keep pace with resident undergraduate tuition and state-mandated fees at the most expensive Washington public university. The state picks the investments and assumes all the investment risks.

If I want to open a 529 plan in Washington, what are my options?

If you want to open a 529 plan through the State of Washington, you can choose from two options:

  • Guaranteed Education Tuition (GET) Program
    GET is a 529 prepaid tuition plan that allows families to buy tuition units. The state guarantees that the value of these units will keep pace with the cost of tuition and state-mandated fees at the state’s highest-priced university.
  • DreamAhead College Investment Plan
    An investment-based 529 college savings plan. You choose from a variety of investment options depending on your risk tolerance and the student’s age. These investments are not guaranteed by the state, so there is the potential that your investment will grow more slowly (or more quickly) than tuition or that you may lose money.

Helpful websites

  • WA 529
    Washington’s GET program and DreamAhead and program.