5 best 529 plans for high-income earners

College costs keep outrunning inflation, and investment taxes nibble at every gain. If your household earns more than $200 000, you feel both pressures. That’s why we lean on 529 plans: they deliver tax-free growth, tax-free withdrawals, and estate perks in one flexible account. New rules sweeten the deal—unused funds can roll into a Roth IRA, and grandparent-owned accounts no longer hurt financial aid—so every dollar works harder for your family.

But not every 529 is equal. Fees, state tax breaks, investment menus, and contribution caps vary, and sticking with your home-state plan can cost thousands. We reviewed more than 90 programs and surfaced five that stand out for affluent savers. Over the next pages you’ll compare them side by side and learn advanced plays, from five-year super-funding to dynasty-style beneficiary changes. Ready to make college funding the simplest line in your plan? Let’s dive in.

Our methodology: how we crowned the top five

Choosing a 529 plan can feel like picking a favorite star in a crowded galaxy. We cut through the glare with a disciplined, data-first process.

First, we gathered the latest Morningstar 2024 Medalist ratings, Savingforcollege fee tables, and every plan’s disclosure statement. Those sources spotlight what matters to investors: cost, oversight, and long-term results. Morningstar’s forward-looking ratings served as our quality compass, and only plans wearing a Gold, Silver, or high Bronze badge made the first cut.

Next, we weighted each factor to match a high-earner’s priorities. Fees carried 30 percent of the score because every basis point saved compounds on six-figure balances. State tax perks earned 20 percent, since large deductions deliver instant, risk-free returns. Historical performance and governance also counted 20 percent; we favor plans with consistent, benchmark-beating records under seasoned stewards. Investment flexibility received 15 percent, rewarding menus that offer both age-based tracks and build-your-own portfolios. The final 15 percent went to contribution limits plus special features such as super-funding ease or ESG options.

We then ran every contender through a real-world lens. If a plan looked good on paper but lacked estate-planning or high-balance utility, it was dropped. The five survivors excel on every metric and, more important, solve the problems affluent families face.

That’s the playbook behind our list, and it’s why you can trust the names that follow.

Bright Start 529 college savings (Illinois)

Bright Start Illinois 529 college savings plan official website screenshot

Illinois spent the last decade overhauling Bright Start, and the results show. Fees now start at 0.10 percent on the index age-based track, so more of your money compounds for tuition instead of slipping into overhead.

Choice sets this plan apart. A multi-manager lineup blends Vanguard index funds with active options from BlackRock and T. Rowe Price. You can leave the allocation to an age glide path or build a custom mix from more than twenty single-asset portfolios. Few 529 plans offer an institutional toolkit at retail pricing.

Tax perks add another lift.

Bright Start’s own explainer, everything you need to know about 529 plans, details Illinois’s up-to-$20,000 annual deduction and the new rule that lets families roll up to $35,000 of leftover 529 money into a Roth IRA. Both perks can supercharge after-tax results for six-figure savers.

Married Illinois filers can deduct up to twenty thousand dollars of contributions each year, trimming about one thousand dollars off a top-bracket state bill. Stack that instant benefit on ultra-low fees and you create a solid risk-free return for high earners.

Who gains most? Affluent Illinois residents lead the list, yet any family nationwide that wants microscopic costs and first-rate fund choice should keep Bright Start in the mix.

New York 529 college savings program (direct plan)

If your investing mantra is “costs kill”, New York speaks your language. Each portfolio in the direct plan charges a single lean fee of 0.13 percent, or about thirteen cents per hundred dollars per year, lower than many index funds outside the 529 world.

Simplicity drives those savings. The lineup sticks to Vanguard index funds, so you enjoy broad market exposure without paying for star managers. Because performance mirrors the benchmarks, low expenses let net returns edge ahead of pricier rivals over long stretches.

State residents collect another reward. Joint filers can deduct up to ten thousand dollars of contributions each year. At the top 10.9 percent state rate, that trims roughly one thousand dollars from this year’s tax bill. Combine that instant benefit with very low fees and you have a strong win for high earners.

Out-of-state investors are welcome as well. If your home state offers little or no deduction, parking money here is an easy way to keep costs minimal while your child’s tuition target grows.

my529 (Utah)

Utah’s my529 feels like a build-your-own kitchen for college funding. You start with very low-cost ingredients such as Vanguard and DFA institutional shares, then season to taste. Want a classic 60/40 mix? Two clicks. Prefer an equity tilt with a dash of real estate? You’re the chef.

That freedom sits on fees that hover near 0.11 percent in the age-based tracks. Even fully custom portfolios rarely top 0.30 percent. On a 200 000-dollar balance, that gap keeps hundreds working for you each year instead of slipping into overhead.

The state sweetens the pot with a five-percent credit on contributions. A 10 000-dollar deposit, for instance, earns a 500-dollar credit. More compelling is Utah’s lifetime cap of about 660 000 dollars per beneficiary, so goals such as medical school or a multigeneration family education fund fit comfortably inside the plan.

If you prize control, or if your advisor wants to run a value tilt without the drag of an advisor-sold plan, my529 stands out. Think of it as a blank canvas ready for your family’s tuition masterpiece.

Pennsylvania 529 investment plan (direct)

Pennsylvania’s direct plan checks every high-earner box without fuss. Fees sit in the low-twenties basis-point range, about 0.20 percent, thanks to Vanguard index funds and a trim state program charge.

The tax treatment is even friendlier. Pennsylvania offers tax parity, so residents can deduct up to 34 000 dollars per beneficiary each year no matter which state’s plan they choose. For a top-bracket couple, that deduction can trim roughly 1 000 dollars from this year’s state bill. Using the home plan also keeps assets inside a program Morningstar rates Gold, so you gain the break and stay under solid oversight.

Investment choice is broad without feeling overwhelming. Three age-based tracks serve set-and-forget savers, while more than twenty static portfolios include a Socially Responsible Equity option, which is still uncommon among 529 plans. Oversight comes from the state treasury and Vanguard, a partnership Morningstar praises for consistent process and an investor-first culture.

For wealthy Pennsylvanians, the math is simple: max the state deduction here, then diversify elsewhere if you want additional flavors. Everyone else can view the PA plan as a low-cost gateway to Vanguard with an ESG twist.

ScholarShare 529 (California)

ScholarShare California 529 college savings plan official website screenshot

California offers no state tax deduction, yet ScholarShare ranks among the best because expenses dip as low as 0.04 percent on certain index portfolios. Even the feature-rich age-based tracks sit near 0.15 percent, making the plan one of the least costly ways to own a globally diversified mix. On a 200 000-dollar balance, a 0.04-percent fee equals just 80 dollars a year.

Choice feels balanced rather than overwhelming. You can select a passive equity track, choose an actively managed Social Choice option, or place late-stage dollars in a principal-protected account. All portfolios are run by TIAA with clear pricing and straightforward online tools.

For high-income Californians already facing steep state taxes, shaving every basis point from investment costs is the next frontier of savings. ScholarShare helps meet that goal while providing in-state oversight and no residency lock-in if you move. Out-of-state savers who want very low expenses will also find a good fit here.

How the five plans stack up side by side

Numbers tell a clearer story than adjectives, so let’s zoom out and compare the essentials.

Fee check

Lower cost equals higher net return, especially when balances reach six figures. The table shows the typical all-in expense for a mainstream age-based portfolio in each plan.

Plan	Typical annual fee
Illinois Bright Start	0.10 percent
New York Direct	0.13 percent
Utah my529	0.11 percent
Pennsylvania Direct	0.20 percent
California ScholarShare	0.15 percent

All five options land well below the national 529 average of roughly 0.45 percent, so you start from a position of strength. Illinois charges the least, yet the spread from first to fifth is only a few basis points. On a 200 000-dollar account, that difference equals a few hundred dollars per year—worth noting but not worth losing sleep over if another plan offers stronger tax perks.

Tax break tally

State incentives can put money back in your pocket right away. Here’s what a top-bracket couple can claim each year.

Plan (state)	Annual deduction or credit	Instant dollar benefit*
Illinois	20 000-dollar deduction	≈ 990 dollars
New York	10 000-dollar deduction	≈ 1 090 dollars
Utah	5 percent credit up to the statutory limit	up to ≈ 240 dollars
Pennsylvania	34 000-dollar deduction**	≈ 1 040 dollars
California	None	0 dollars

*Benefit assumes the current top state rate.

**Pennsylvania offers tax parity, so residents can claim this even if they use another state’s plan.

The takeaway is simple: if your state hands you a four-figure deduction, capture it first. After that, send extra dollars to the lowest-cost or most flexible plan for your needs.

Performance snapshot

Past returns never guarantee future results, yet they show whether a plan’s process works. Over the last five years, all five moderate age-based tracks ranked in the top half nationwide. Utah and Illinois often reached the top quartile, helped by thoughtful asset mixes and very thin expenses. New York and California hugged the benchmarks they track, exactly the goal for pure index portfolios.

Putting it together

Start with your home-state tax break. If it’s generous, contribute enough to secure the full benefit. For any additional funding, weigh the very low fees of New York, California, or Illinois against the customization of Utah or the ESG tilt in Pennsylvania. No matter which of these five you choose, you’ll avoid the bloated costs and weak oversight that weaken many other state plans.

That comparison keeps more of your money compounding for tuition instead of slipping away to overhead.

Advanced strategies for affluent 529 investors

Super-funding: front-load five years of gifts today

Think of super-funding as pressing the gas as soon as the light turns green. The IRS lets each parent contribute up to five years of annual gift exclusions at once: 95 000 dollars per child in 2026, or 190 000 dollars for a couple.

Why act early? Every dollar receives up to 18 years of tax-free growth rather than trickling in over time. The estate benefit is just as powerful. The lump sum leaves your taxable estate once five years pass, yet you keep full control of the account.

Keep two safeguards in mind:

File Form 709 to elect the five-year spread so the gift skips your lifetime exemption.
If death occurs within the five-year window, the unused portion returns to your estate, so maintain adequate life insurance or liquidity.

Handle those details and super-funding can close the college gap without years of spreadsheet upkeep.

Dynasty planning: turn one 529 into a family education fund

A 529 stays open after your child graduates. You can change beneficiaries at any time and let the balance keep compounding free of federal tax. That trio of freedoms supports a multigenerational tactic often called a “dynasty 529.”

Fund the account aggressively while children are young, then leave leftovers invested. When grandchildren arrive, switch the beneficiary to the next scholar in line. Growth from today until that future transfer escapes both income and capital-gains tax.

Control also stays with you. Unlike an irrevocable trust, you decide when to shift beneficiaries, how much to withdraw, and which investments to hold. If life changes, you can redirect the money to another family member headed to graduate school.

Watch one rule: switching the beneficiary down more than one generation may trigger generation-skipping transfer tax. A simple workaround is a two-step move—first make your adult child the account owner, then have that child name the grandchild as beneficiary.

The 529-to-Roth rollover: a built-in exit plan

Overfunding once scared diligent savers. SECURE 2.0 fixed that worry. Starting in 2024, you can roll up to 35 000 dollars of unused 529 money into the beneficiary’s Roth IRA once the account is at least 15 years old.

Follow three checkpoints:

Confirm the 529 has existed for 15 years; contributions made within the last five must stay until they age out.
Roll only the annual Roth limit each calendar year (currently 6 500 dollars).
Keep the beneficiary the same on both accounts; owner changes are fine.

A 22-year-old graduate who receives even 20 000 dollars in a Roth IRA could see it grow into six figures by retirement at no extra cost to the family.

Rapid-fire FAQs for high-income savers

Should we fill a 529 before our 401(k) and backdoor Roth?

No. Capture the employer match, max the 401(k), and run the backdoor Roth first. College has loans; retirement does not.

What if my child earns a full scholarship?

Scholarship amounts can be withdrawn penalty-free; only ordinary tax applies to earnings. Or keep the money for grad school, another sibling, or a future Roth rollover.

We live in a state with a small deduction but a mediocre plan. Stay or go?

Grab the deduction on the first dollars, then send the rest to one of the five elite plans above. Over time the fee savings will outweigh a modest tax break.

Are advisor-sold 529s ever worth considering?

Rarely. Loads and higher expense ratios drain returns that should belong to your child, not a broker. Most advisors can still oversee a direct plan.

Can I pay private K-12 tuition with a 529?

Up to 10 000 dollars per student per year qualifies at the federal level, but some states recapture deductions on those withdrawals. Check local rules before tapping the account early.

Do 529 assets hurt need-based aid?

Parent-owned 529s count lightly—about five cents per dollar—and the FAFSA no longer asks about grandparent-owned accounts. For most affluent families, need-based aid was unlikely anyway, so save aggressively without fear.

Conclusion