Useful next calculations
When to use this calculator
- Before choosing between saving, investing or changing a contribution.
- When you want to compare cautious, base and optimistic return assumptions.
- When you need a projection before making a longer-term decision.
- When you want to see whether starting earlier or contributing more changes the outcome more.
A worked example
These are the example figures the calculator opens with.
| Input | Value |
|---|---|
| Child's Current Age | 5 |
| College Start Age | 18 |
| Current 529 Balance ($) | $0 |
| Monthly Contribution ($) | $200 |
For those figures the calculator returns:
- Projected 529 balance: $48,036.16
- Projected 4-year cost: $247,473.61
- Projected annual cost: $58,277.57
- Funding gap: $199,437.45
- Coverage: 19.40%
Method & assumptions
This calculator projects the growth of a 529 college savings plan using annual compound growth applied to your starting balance plus contributions. Each year, the existing balance and annual contributions are multiplied by one plus your expected return rate, simulating a tax-deferred account where earnings are not reduced by taxes while the money remains invested. Future college costs are projected by compounding today's annual cost at your chosen tuition inflation rate over the years until college begins — historically around 4% per year for US four-year institutions. Each of the four college years continues to inflate from its own start year. The four-year total is then compared against your projected balance to show a coverage percentage and any funding gap.
The model does not account for the state income tax deduction many US 529 plan holders receive on annual contributions, which can effectively boost your net return by 3% to 10% depending on your state tax rate. It also does not model year-by-year asset allocation shifts, such as the age-based glide paths most 529 plans offer that automatically move from equities toward bonds as college approaches. Qualified 529 withdrawals are tax-free at the federal level for eligible education expenses including tuition, fees, room and board, and books, making the effective after-tax growth of a 529 plan significantly better than a standard taxable brokerage account for this purpose.
Common mistakes
- Using an assumption that is not supported by a current local quote, bill, statement or official source.
- Treating a generic estimate as a lender, provider, payroll or tax authority decision.
- Mixing monthly and annual inputs without converting them consistently.
- Testing only one scenario instead of checking how a cautious assumption changes the result.
What to do next
- Run a second scenario with a cautious assumption so you can see the downside clearly.
- Compare the result with the related calculators below before making a decision.
- Check current local rules, eligibility and provider terms before applying or committing money.
- Keep a record of the assumptions so you can update the estimate when a quote, bill or pay figure changes.