Arizona 529 College Savings Plan

The Benefits Of 529 College Savings Plans

529 College Savings Plans are one of the best investments for your children’s education that a parent can make. A 529 College Savings Account is an excellent option for parents looking where to invest in their children. The plan allows parents to contribute after-tax dollars into the account, and the earnings and interest grow tax-free.

The parent can withdraw the money and earnings tax-free if they are used for a qualified educational expense. Additionally, with a 529 College Savings Plan, the parent retains control over the account. So, if your child decides to skip college, you can transfer the account to another beneficiary.

Tax Benefits Of 529 College Savings Plans

Nevertheless, the benefits are substantial if you concentrate on saving for your children’s education. Even though the amount you contribute cannot generally be deducted from your taxes, some states allow deductions on a portion or the entire amount you put into the plan.

Regardless, the principal is tax-deferred, and any college expense paid with the savings in the plan is tax-exempt. What’s nice about a 529 College Savings Plan is the latitude and authority you possess concerning contributions.

The named beneficiary has no privileges in this regard. You can even make a distribution to yourself. Although, the part in earnings of the amount withdrawn will be assessed a penalty and be taxed for income tax purposes. The plan provides tax-exempt money for educational purposes, provided that the money is used solely for that reason.

Arizona 529 College Savings Plan

Why You Should Give Back to Your College Alma Mater

About: Arizona’s Education Savings Plan is a state-sponsored 529 plan designed to provide a parent, grandparent or future students an opportunity to save for educational expenses in a tax-deferred manner. You can open an account today for $25 or less.

Arizona’s Education Savings Plan offers a variety of investment choices including both FDIC insured CD’s and Mutual Funds. The Arizona 529 Plan offers savings options to meet your specific investment style and risk tolerance through two direct to consumer sold programs and one financial advisor-sold program.

Four FDIC-insured options are offered in the Arizona Family College Savings Program — CollegeSure 529 Plan: (1) the CollegeSure CD with a variable interest rate pegged to a private-college tuition index, (2) the InvestorSure CD with an interest rate pegged to a percentage of the increase in the S&P 500 Index over a five-year period, (3) fixed-rate CDs with one-year or three-year maturities, and (4) the Honors Savings Account, a high-yield savings account available from College Savings Bank, a Division of NexBank SSB.


  • College Savings Bank – 1.800.888.2723
  • Fidelity Investments – 1.800.544.1262
  • Ivy Investments – 1.888.923.3355

Investment Options: College Savings Bank offers a high-yield savings account and three direct to consumer sold FDIC-insured Certificates of Deposits (CD’s). All College Savings Bank’s savings options are FDIC-insured up to $250,000 for accounts held in the same right and capacity.

Fidelity offers multiple investment options, including Age-Based Portfolios, Static Portfolios, and Individual Mutual Fund Portfolios, or a combination of these options.

The Ivy InvestEd 529 Plan offers multiple investment options, including ten Age-Based Portfolios, ten Static Portfolios, and nineteen Individual Mutual Fund Portfolios, or a combination of these three portfolio options. Please note the Ivy InvestEd 529 Plan is available for investment only through financial advisors.

Tax Benefits: 

Earnings grow tax-free and are not subject to federal income taxes on withdrawals used for qualified education expenses. For designated beneficiaries who are Arizona residents, funds are also not subject to state income taxes when used to pay qualified education expenses of the designated beneficiary.  

For plan participants who are not Arizona Residents, please consult your own State’s tax policies to determine the taxable status of qualified education expenses.  Effective September 29, 2021, for Tax Year 2021 and after, the state of Arizona offers a tax deduction each year for investing in the Arizona 529 Plan of up to $4,000 per beneficiary for married tax filers who file a joint return and up to $2,000 per beneficiary for individual tax filers. There is no limit on the number of beneficiaries Arizona residents can make contributions to in a tax year.

State Residency Requirements: No state residency is required to participate in Arizona 529 College Savings Plans.