Saving for college

At Fidelity, we understand that a college degree is a major financial investment. That's why we've created this online coaching⏤to help guide you through the planning process step-by-step. Follow along as we cover many important aspects of saving for your child's education.

01 Have a family discussion

Getting everyone on the same page about how you'd like to approach paying for college is a critical first step. Use this discussion guide to help you and your family shape how you'll contribute toward college expenses.

Download college discussion guide


Tip from a coach

As your child grows older, engage them in this discussion. Talk openly about the costs associated with different types of colleges, and the amount your family can realistically afford to contribute.

Have a family discussion

02 Estimate the cost

When your child is young and college feels far away, it can be tough to establish a savings target. You can start by using the average cost of college today.

The average annual cost (tuition, fees, and room and board) for a 4-year, in-state public college is $21,950 for the 2019—2020 tuition year, and $49,870 per year for a 4-year private college.*

To get a more detailed estimate, use Fidelity's College Cost Prep tool.

College Cost Prep

Estimate the cost

Tip from a coach

If the total cost of college gives you "sticker shock," remember that there are opportunities for financial aid. The College Board reports that the average full-time undergraduate enrolled in a private nonprofit 4-year college receives enough grant aid to cover about 60% of tuition and fees.*

03 Explore education savings accounts

Decide where to save

There are a few types of accounts that can help you save for college, each with its own benefits. Be sure to review and compare the full list of college savings accounts to determine which one is right for you and your family.

529 college savings plan

For many families, a 529 savings plan makes sense⏤they are flexible accounts that allow earnings on contributions to grow federal income-tax deferred. You also don't have to pay federal income taxes on qualified withdrawals for things like tuition, fees, and room and board.

Individual states offer different 529 plans in conjunction with a financial services company that manages the plan. Be sure to consider your own state plan as it may have additional benefits, including state tax advantages. However, you may choose a 529 savings plan from states across the country⏤even a state that you don't live in. Compare 529 plans from any state

Uniform Gifts to Minors Act/Uniform Transfers to Minors Act accounts (UGMA/UTMA)

UGMAs/UTMAs are custodial accounts that let parents (and others) make an irrevocable gift to a minor that can be used for college or any other purpose. For federal tax purposes, investment earnings are generally taxed at the minor’s tax rate, which is usually lower than a parent’s rate.

Coverdell Education Savings Account (ESA)

Coverdell ESAs allow you to save for college and withdraw money for qualified higher education expenses federal income tax-deferred. However, the annual contribution limit is only $2,000 per beneficiary and higher income households may not be eligible. These are not offered by Fidelity.

Explore education savings accounts

Tip from a coach

Fidelity manages state plans for Arizona, Delaware, Massachusetts, and New Hampshire (National Plan).

04 Open an account

You're almost there! Now that you've defined a savings goal and decided where to save, it's time to open an account.

If you've chosen a 529 savings plan or a custodial account (UGMA/UTMA) with Fidelity, you can get started right away. There is no minimum to open an account.

Open an account

05 Establish good savings habits

Now that you have opened your account, here are a few things you can do to make progress toward your goal.

1. Save regularly

Making monthly contributions with a direct deposit to your college savings account makes it easier for you to save and less likely that you'll skip a contribution.

2. Track your progress

Creating a concrete plan for how you're going to save is crucial—and it can help make the process feel more manageable. Use Fidelity's Planning & Guidance Center to set up a college savings goal and track your progress over time.

Set up a goal

Establish good savings habits

Get help

Speak with a representative 800.544.1914