Murphy Administration Encourages Families During College Savings Month to Open NJBEST 529 Plans to Save for Child’s Future Education & Access Helpful Incentives

Incentives such as Scholarship, Matching Grant & Tax Deductions Available to Eligible New Jersey Residents with NJBEST 529 College Savings Plans

TRENTON, NJ - During National College Savings Month, the Murphy Administration is encouraging New Jersey families to save for their child's future education endeavors by opening an NJBEST 529 College Savings Plan. Not only can these plans be used to help cover tuition and other expenses in a variety of educational settings, but many residents can also access helpful incentives such as a college scholarship, matching grant opportunity, and/or tax deductions offered by the State when they open and contribute to an NJBEST 529 account.

"Our State offers some of the most generous financial aid in the nation, and NJBEST 529 College Savings Plans can act as supplemental funding for any remaining educational costs to help students avoid the need for loans in their pursuit of a college degree," said Margo Chaly, Esq., Executive Director of theHigher Education Student Assistance Authority, the State agency that administers NJBEST 529 College Savings Plans and incentives. "While families should save early and often to get the most benefit out of an already beneficial plan, it is never too late to start saving for the future. I encourage residents throughout New Jersey to learn more and get started by opening an NJBEST 529 College Savings Plan today."

Plans can be opened with as little as $25 and earnings grow federal income tax-free. Savings can be used for education-related expenses such as tuition and fees, room and board, books and supplies, and more, in educational settings such as community colleges, four-year institutions of higher education, vocational schools, and apprenticeships.

To help motivate more families to open an NJBEST 529 plan on behalf of a student, New Jersey offers the following incentives:

• A one-time, dollar-for-dollar match of up to $750 of the first contribution into a new NJBEST 529 plan for new account holders and beneficiaries, if the account holder has an adjusted gross income of up to $75,000;
• An annual State tax deduction of up to $10,000 each year for contributions into an NJBEST 529 plan, even if the contributor is not the account holder, for taxpayers with adjusted gross incomes up to $200,000; and
• A one-time scholarship opportunity up to $6,000 for eligible beneficiaries (the student for whom the plan was opened) who attend a New Jersey college or university, depending on the savings history of the plan.

"The Murphy Administration has consistently prioritized making higher education more affordable for all New Jersey families and these critical incentives will provide an entry way for more families to open and invest in NJBEST 529 plans," said New Jersey State Treasurer Elizabeth Maher Muoio. "By opening these tax-advantaged college savings plans and steadily contributing over time, families will see their earnings grow and will be better prepared for the future."​

"Making college more affordable has been central to our mission of creating greater opportunity and upward mobility for all New Jersey residents," said Dr. Brian K. Bridges, New Jersey Secretary of Higher Education. "While we've strengthened financial aid and expanded wraparound support through programs like the Educational Opportunity Fund, we also know that early planning can make a powerful difference. Research shows that students from lower income backgrounds are three times more likely to attend college even with modest savings. That's why tools like the NJBEST 529 Plan are so important. They make it easy for families to get started with a small amount."

"New Jersey continues to demonstrate its commitment to providing every child with a world-class public education from preschool through high school and preparing them for success after graduation," said New Jersey Department of Education Commissioner Kevin Dehmer. "As a new school year begins, we are pleased to join HESAA in highlighting this important tool to help ensure more families take advantage of the State's savings opportunities. These programs provide families an opportunity to make students' next steps in education more accessible."

It is not only parents who can open an NJBEST 529 plan. These plans can be opened by nearly anyone for anyone. As long as an individual is over the age of 18, has a permanent United States mailing address, and has either a Social Security Number or Taxpayer Identification Number, they can open an NJBEST 529 plan regardless of their income, their connection to the student, or the student's age. That means other relatives or family friends can open an account to help a student start saving for future education expenses, and individuals can even open an account for themselves.

Recognizing that circumstances can change over time, these plans also offer flexibility for plan holders. If the intended recipient of the NJBEST 529 plan does not need the savings, account holders can transfer the plan over to someone else in the beneficiary's family or roll unused assets of up to $35,000 over to the beneficiary's Roth IRA (Individual Retirement Account) with no tax penalty.

The NJBEST 529 College Savings Plan is also ranked 'Top of the Class' by SavingForCollege.com among state-sponsored 529 programs throughout the country, based on criteria such as ease of use and savings success that make the plan attractive to potential savers. ​

To learn more about these plans and the helpful incentives offered by New Jersey, residents can visit https://www.hesaa.org/pages/NJBESTHome.aspx.

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