While driving, have you seen the bumper sticker that proclaims, “My kid and my money to go (insert the name of school here)?” Does it make you smile or does it make your heart beat a little quicker? Whether college is right around the corner or you’re still dealing with diapers, Ohio 529 CollegeAdvantage, is here to help you save for your child’s future college and career training costs.
Ohio 529 is your forward-thinking solution to student loan debt. Here’s how:
529 tax benefits
529 accounts are tax-advantaged college savings plans. What are these tax benefits?
- Tax-free earnings. A regular savings account will have taxes assessed yearly but a 529 investment plan grows tax-free at the federal and state level. To see how tax-free growth adds up with a 529 savings plan, use the tax benefit tool to show the savings in taxes between a 529 to a taxable account. Unlike a taxable account, a CollegeAdvantage 529 plan ensures that every bit of investment growth is yours to use, tax-free.
- Tax-free withdrawals. Funds withdrawn from 529 plans are tax free when used for qualified higher education expenses. What are these expenses? Costs that are necessary for enrollment or attendance at an eligible education institution like: tuition, mandatory fees, computer equipment and related technology and services, books, supplies, and equipment required for enrollment or attendance; room and board costs or off-campus housing during any academic period in which the beneficiary is enrolled at least half-time; and certain expenses for a special-needs student.
- State income tax deduction for contributions to Ohio’s 529 Plan. As a resident of Ohio, you can currently deduct 529 contributions up to $4,000 per beneficiary, per year from your state income tax. However, with unlimited carry forward you can continue to deduct a large 529 plan contribution from your state income tax until all of it has been deducted. For instance, if you contribute $12,000 to your beneficiary’s account, you can deduct $4,000 from your state income tax for the next three years.
Many 529 investment options
The CollegeAdvantage Direct Plan offers a variety of investment options. You can also use our tools and calculators to determine your savings goals. After reviewing this information, you can start to build a 529 investment portfolio that best fits your family’s needs. The CollegeAdvantage Direct Plan offers target-enrollment portfolios, ready-made, risk-based portfolios, individual investment vehicles, and FDIC-insured banking options. Ohio’s Direct 529 plan has partnered with leading investment managers Vanguard, Dimensional Fund Advisors, and Fifth Third Bank to provide these 529 investment options.
Industry honors
Every year, trusted financial industry investment research and management company, Morningstar, reviews the nation’s 529 college savings programs. Once its analysis is complete, Morningstar ranks the 529 plans. Ohio’s CollegeAdvantage Direct 529 Plan maintained its silver rating for the thirteenth year in a row. In addition, BlackRock CollegeAdvantage, Ohio’s Advisor 529 Plan, retained its silver ranking. This makes Ohio one of only two state programs that have both their Direct and Advisor 529 Plans ranked as medal-class college savings programs by Morningstar. The high ranking for both CollegeAdvantage 529 Plans highlights the strength of these two college savings plans as well as the industry’s regard for Ohio’s 529 Plan as one of the best in the nation.
Also, CNBC selected Ohio’s 529 Plan as one of the five best programs nationwide. As they wrote, “There isn’t much not to like about the CollegeAdvantage 529 plan — there’s a good mix of investment options (including FDIC-insured accounts), low fees and plans from top companies like Dimensional Fund Advisors. In fact, overall management fees are some of the lowest we’ve seen. Combined with low expense ratios, this makes this plan one of our top picks.”
The gift that keeps on giving – compound interest
It’s never too late or too early to save for your child’s future college costs. However, if you set aside college savings in a 529 plan early in your child’s life, the 529 account will benefit from compound interest through investing over the years. Compound interest is a saving powerhouse as it is the “interest computed on the sum of an original principal and accrued interest,” according to Merriam-Webster Dictionary. For 529 plans, compound interest is based on contributions, earnings, and interest already accumulated in the account.
Compound interest in a 529 college saving plan is a huge advantage; yet, compound interest with student loans is a huge disadvantage. This is why 529 plans are a great alternative to student loan debt. Saving now for post-secondary education or training is far cheaper than paying off student loans debt later in life.
Ohio’s 529 Plan can be used nationwide
Saving for college in Ohio’s 529 Plan does not mean your child is limited to only attending Ohio schools. 529 plans can be used nationwide (and even overseas) at any accredited two-year, four-year, graduate or professional, or any other post-secondary schools that accepts federal financial aid.
Get To Know Ohio’s 529 Plan
Since 1989, Ohio Tuition Trust Authority (OTTA) has been helping families save for college. OTTA is the state agency that sponsors Ohio 529 CollegeAdvantage. Currently, Ohio 529 is the seventh largest college savings program in the nation. With assets under management valued over $20.44 billion, Ohio 529 is entrusted with over 690,000 college savings accounts as of March 31, 2026.
No matter the age of your child, CollegeAdvantage is how forward-thinking parents make their children's education after high school doable. Visit Ohio 529 CollegeAdvantage to start saving today for your child’s future education. An investment in a 529 plan is an investment in your child where every dollar saved today is a dollar that doesn’t have to be borrowed later. Learn, plan, and start with Ohio 529 today at CollegeAdvantage.
The article was originally published in September 2017and have been updated in July 2026 with new information.
