529 Plan Calculator: Growth, Tax Savings & College Fund

How your 529 plan is worked out

On the defaults — a $5,000.00 lump sum, $3,000.00 a year, 12 years, a 7% return and a 15% tax rate — the future value is $64,926.31, the total contributions are $41,000.00, the tax-free growth is $23,926.31, the tax saved is $3,588.95 and the taxable-account value is $61,337.36. The whole calculation is five moves: add up what you put in, grow the lump sum, grow the annual contributions, add them together for the future value, and multiply the growth by your tax rate for the tax saved.

Seven things about the model are worth stating plainly. First, contributions are after-tax money — there is no federal deduction for 529 contributions, though many states offer a state deduction, which this calculator does not model. Second, earnings withdrawn for qualified education expenses are federal-tax-free — that is the whole point of the account. Third, earnings withdrawn for non-qualified expenses face income tax plus a 10% penalty on the earnings. Fourth, up to $35,000 of leftover money can roll to a Roth IRA over a lifetime, if the account has been open 15+ years and annual limits allow it. Fifth, a 529 can pay up to $10,000 a year of K–12 tuition. Sixth, the 2026 annual gift-tax exclusion is $19,000 per recipient, and a five-year “superfunding” election lets one gift cover five years at once. And seventh, the return is assumed constant — real returns vary year to year, and this calculator does not model plan fees.

The worked example, line by line

Setup: lump sum $5,000.00, annual contribution $3,000.00, 12 years, annual return 7%, capital-gains tax rate 15%.

Line 1 — add up what you put in. The total contributions are the lump sum plus the annual contribution times the years: $5,000.00 + $3,000.00 × 12 = $41,000.00.

Line 2 — grow the lump sum. The lump sum grows for the full 12 years: $5,000.00 × (1.07)¹² = $5,000.00 × 2.25219159 = $11,260.96.

Line 3 — grow the annual contributions. Each yearly $3,000.00 grows for the years left after it goes in; the annuity factor is ((1.07)¹² − 1) ÷ 0.07 = 17.88845127, so $3,000.00 × 17.88845127 = $53,665.35.

Line 4 — add them together for the future value. $11,260.96 + $53,665.35 = $64,926.31.

Line 5 — subtract the contributions for the tax-free growth. $64,926.31 − $41,000.00 = $23,926.31.

Line 6 — multiply the growth by your tax rate for the tax saved. $23,926.31 × 15% = $3,588.95. The same money in a taxable account would be worth $64,926.31 − $3,588.95 = $61,337.36. Rounding convention: totals are computed from unrounded values, so rounded parts may differ by a cent from their rounded sum.

Every branch, checked

Years 18: Lump $5,000.00, annual $3,000.00, years 18, return 7.00%, tax 15.00%, future value $118,896.76, contributions $59,000.00, growth $59,896.76, tax saved $8,984.51, taxable $109,912.25 — six more years nearly doubles the future value, from $64,926.31 to $118,896.76, on only $18,000.00 more of contributions. Years is the strongest lever in the plan.

Annual $5,000: Lump $5,000.00, annual $5,000.00, years 12, return 7.00%, tax 15.00%, future value $100,703.21, contributions $65,000.00, growth $35,703.21, tax saved $5,355.48, taxable $95,347.73 — adding $2,000.00 a year lifts the future value by $35,776.90 and the tax saved by $1,766.53.

Return 5%: Lump $5,000.00, annual $3,000.00, years 12, return 5.00%, tax 15.00%, future value $56,730.66, contributions $41,000.00, growth $15,730.66, tax saved $2,359.60, taxable $54,371.06 — two points less return costs $8,195.65 of future value and $1,229.35 of tax saved.

Lump $0: Lump $0.00, annual $3,000.00, years 12, return 7.00%, tax 15.00%, future value $53,665.35, contributions $36,000.00, growth $17,665.35, tax saved $2,649.80, taxable $51,015.55 — starting with nothing still reaches $53,665.35 on yearly contributions alone, but the missing $5,000.00 lump sum costs $11,260.96 of future value.

Tax rate 22%: Lump $5,000.00, annual $3,000.00, years 12, return 7.00%, tax 22.00%, future value $64,926.31, contributions $41,000.00, growth $23,926.31, tax saved $5,263.79, taxable $59,662.52 — the tax rate never changes the 529 future value; it only raises the tax saved, from $3,588.95 to $5,263.79, and lowers the taxable-account value by the same dollars.

Years 4: Lump $5,000.00, annual $3,000.00, years 4, return 7.00%, tax 15.00%, future value $19,873.81, contributions $17,000.00, growth $2,873.81, tax saved $431.07, taxable $19,442.74 — with only four years the growth is just $2,873.81, so the tax saved is only $431.07. Starting early matters more than saving hard late.

Lump $10,000, annual $5,000, 18 years: Lump $10,000.00, annual $5,000.00, years 18, return 7.00%, tax 15.00%, future value $203,794.49, contributions $100,000.00, growth $103,794.49, tax saved $15,569.17, taxable $188,225.31 — the growth finally passes the contributions: $103,794.49 of growth on $100,000.00 put in, saving $15,569.17 in tax.

The reverses, worked backwards

Annual contribution for a future value of exactly $100,000: $4,960.69 — the exact annual contribution is $4960.6889. At $4,960.69 a year the future value is $100,000.02, which does NOT land exactly on $100,000.00 — that is correct under the continuous convention, because the displayed value is rounded to cents. $0.01 less, $4,960.68, gives a future value of $99,999.84. The star is DOLLARS.

Years for a future value of at least $50,000: 10 years — the smallest term that gets there. At 10 years the future value is $51,285.10; 9 years gives $45,126.26, short of $50,000.00. This is a step reverse: years come in whole numbers, so there is no exact 9-point-something. The star is YEARS.

Annual return for a future value of exactly $75,000: 9.10% — the exact return is 9.0994%. At the displayed 9.10% the future value is $75,003.11, which does NOT land exactly on $75,000.00 — that is correct under the continuous convention. 9.09% gives $74,951.17; 9.11% gives $75,055.09. The displayed rate is a 2dp percent. The star is a PERCENT.

Lump sum for a future value of exactly $60,000: $2,812.66 — the exact lump sum is $2812.6587. At $2,812.66 the future value is $60,000.00; $1 less, $2,811.66, gives $59,997.75. The star is DOLLARS.

Capital-gains tax rate for a tax saved of exactly $5,000: 20.90% — the exact tax rate is 20.8975%. At the displayed 20.90% the tax saved is $5,000.60, which does NOT land exactly on $5,000.00 — that is correct under the continuous convention. 20.89% gives $4,998.21; 20.91% gives $5,002.99. The star is a PERCENT.

Years for a tax saved of at least $5,000: 14 years — the smallest term that gets there. At 14 years the tax saved is $5,031.62; 13 years gives $4,270.67, short of $5,000.00. This is a step reverse: years come in whole numbers. The star is YEARS.

What the defaults assume

The future value is the lump sum times (1 + return) to the power of years, plus the annual contribution times the annuity factor ((1 + return)^years − 1) ÷ return, with contributions at the end of each year; at a 0% return the future value is simply the lump sum plus the annual contribution times the years. Total contributions are the lump sum plus the annual contribution times the years; tax-free growth is the future value minus the contributions; the tax saved is the growth times the capital-gains tax rate; and the taxable-account value is the future value minus the tax saved. At the edges the model stays honest: with 0 years, Lump $5,000.00, annual $3,000.00, years 0, return 7.00%, tax 15.00%, future value $5,000.00, contributions $5,000.00, growth $0.00, tax saved $0.00, taxable $5,000.00 — the lump sum alone, no growth, and that is the model at its boundary, not an error. With $0 contributions, Lump $0.00, annual $0.00, years 12, return 7.00%, tax 15.00%, future value $0.00, contributions $0.00, growth $0.00, tax saved $0.00, taxable $0.00. With a 0% return, Lump $5,000.00, annual $3,000.00, years 12, return 0.00%, tax 15.00%, future value $41,000.00, contributions $41,000.00, growth $0.00, tax saved $0.00, taxable $41,000.00 — no growth means no tax to save. With 1 year, Lump $5,000.00, annual $3,000.00, years 1, return 7.00%, tax 15.00%, future value $8,350.00, contributions $8,000.00, growth $350.00, tax saved $52.50, taxable $8,297.50. With a $100,000 lump sum, Lump $100,000.00, annual $3,000.00, years 12, return 7.00%, tax 15.00%, future value $278,884.51, contributions $136,000.00, growth $142,884.51, tax saved $21,432.68, taxable $257,451.84. With a 0% tax rate, Lump $5,000.00, annual $3,000.00, years 12, return 7.00%, tax 0.00%, future value $64,926.31, contributions $41,000.00, growth $23,926.31, tax saved $0.00, taxable $64,926.31 — the taxable account keeps everything when the tax rate is zero. Rounding convention: totals are computed from unrounded values, so rounded parts may differ by a cent from their rounded sum.

Output · formula · meaning

Who uses this

• The parent of a newborn starting early: they learn that $5,000.00 now plus $3,000.00 a year grows to $64,926.31 in 12 years, with $23,926.31 of tax-free growth — and they check the 18-year branch to see what six more years does to the same plan.
• The parent with a college target in mind: they learn that reaching exactly $100,000.00 takes $4,960.69 a year (exact $4960.6889), and that 10 years is the smallest term that reaches $50,000.00, at $51,285.10 — and they check the 9-year figure to see how short they fall.
• The saver comparing a 529 with a taxable account: they learn that at a 15% tax rate the 529 saves $3,588.95 versus a taxable account worth $61,337.36, and at 22% it saves $5,263.79 — and they check the 20.90% reverse to see what tax rate makes the saving exactly $5,000.00.
• The grandparent planning a big gift: they learn that the 2026 gift-tax exclusion is $19,000 per recipient and a five-year superfunding election lets one gift cover five years at once — and they check the $100,000 lump-sum edge to see what a large gift grows to in 12 years.

Accuracy & limitations

The math is first-principles: the future value is the lump sum times (1 + return) to the power of years, plus the annual contribution times the annuity factor ((1 + return)^years − 1) ÷ return, with contributions at the end of each year (at a 0% return the future value is simply the lump sum plus the annual contribution times the years); total contributions are the lump sum plus the annual contribution times the years; tax-free growth is the future value minus the contributions; the tax saved is the growth times the capital-gains tax rate; and the taxable-account value is the future value minus the tax saved. Every figure is rounded to cents half-up, and the totals are computed from unrounded values, so rounded parts may differ by a cent from their rounded sum. What the model cannot do is tell you what YOUR plan will earn: it assumes a constant return, and real returns vary year to year; it does NOT model plan fees, which eat into the growth; it does NOT model state tax deductions for contributions, which vary by state and can add real value; it treats the taxable account as paying tax only on the growth at the end, while a real taxable account pays tax on dividends and gains along the way; and it does NOT model what happens if the money is used for non-qualified expenses (income tax plus a 10% penalty on the earnings), the $35,000 lifetime Roth IRA rollover for leftover money, or K–12 tuition use up to $10,000 a year — those are rules to check, not numbers in the model. Use it to judge what a 529 plan can grow to, then check your state’s deduction and your plan’s fees before you open one.

Frequently asked questions