529 Contributions Are Thoughtful and Meaningful Graduation Gifts

By Rachel Biar, Deputy State Treasurer for Savings Programs, Nebraska & Past Chair, CSPN

March 15, 2025

Cue the gowns and tassels: Graduation season is officially here!

Whether your loved one is graduating from kindergarten, elementary, middle school, or high school, he or she has achieved a milestone that is cause for celebration.

This year is a special year for my family as my oldest nephew graduates from high school this month. Like so many of you this time of year, I am amazed at how fast time flies. I still remember opening his 529 plan savings account when he was just a baby. It has been joyful to watch him grow, learn, and become an energetic, intelligent, driven, and kind young man. As we celebrate this special graduation milestone, he will receive an extra contribution into his 529 plan account to help prepare him for college this fall.

As you think about the graduates in your life while browsing the aisles searching for the right gift, consider a contribution to a 529 account. 529 plans make it easy to show loved ones how much you care. A 529 contribution can make a meaningful graduation gift at any age.

Kindergarten Graduates: Give the Gift of Time

In kindergarten, higher education may seem like a long way off. But one of the best gifts that you can give your young graduate is an early start on their college savings journey.

Simply put, saving for a longer stretch of time creates more opportunities to contribute and grow your savings. Because 529 account earnings are state and federal income tax-deferred, the full earnings amount remains in your account and grows with no money being subtracted to pay current tax obligations. Consequently, earnings happen more tax efficiently, helping to increase your account value even faster and maximize earnings potential associated with market growth.

Given the structure of compounded tax-deferred growth, it is in every kindergartener’s best interest to get an early start on his or her 529 plan account. This spring help your graduate build that base, and encourage friends and family to contribute as well.

Elementary and Middle School Graduates: Give the Gift of Motivation

Graduating elementary and middle schoolers are eagerly anticipating their next steps, whether that be middle school or high school. Dreaming about new classes, friends, activities and accomplishments, the future is full of limitless opportunities. Show these graduates that you believe in their future success, and that the sky is the limit, with a 529 gift contribution.

If your graduate is not familiar with the college savings process, a gift contribution is also the perfect spark for a conversation about the hard work and dedication that goes into achieving your dreams. He or she will spend the next few years preparing for higher education and beyond – with a gift contribution, demonstrate the crucial role that college savings will play.

High School Graduates: Give the Gift of Opportunity

Even at high school graduation, it is not too late to give the gift of college savings. After all, higher education brings a variety of expenses. 529 savings can be used to cover many of them, from tuition and fees to supplies, necessary technology, and even room and board. 

The more of these expenses new college students can cover with their 529 plan savings, the more they will be able to focus extra funds in other areas, such as building emergency funds, exploring the world, or saving for the future.

Regardless of a student’s age, higher education is a gift that will last a lifetime. To learn more about your 529 plan’s gifting options, find your state’s 529 plan at our link: https://www.collegesavings.org/find-my-states-529-plan and give the gift of education savings for all the graduates in your life who are taking the next step toward their futures.

When you do, like me, you will reflect on the memories made, you will celebrate your graduate’s achievements, and you will have a sense of pride knowing you have helped them in their education savings journey. And that is a special gift that will last a lifetime.

About the author:

Rachel Biar is Deputy State Treasurer for Savings Programs in Nebraska and serves as Past Chair of the College Savings Plans Network. In her role, she serves as the Director for the NEST 529 Education Savings Program. The Nebraska Educational Savings Trust (NEST) provides four plans: NEST Direct College Savings Plan, the NEST Advisor College Savings Plan, Bloomwell 529 Education Savings Plan, and the State Farm 529 Savings Plan. The Nebraska State Treasurer serves as the Program Trustee. Union Bank & Trust serves as the Program Manager, and all investments are approved by the Nebraska Investment Council. Families nationwide are saving for college using the NEST 529 plans, which have $7.1 billion in assets and more than 302,000 accounts. Visit NEST529.com and treasurer.nebraska.gov for more information.