Let Us Help You Explore College Savings Plans

You face challenges that your parents didn't: soaring tuition costs and an array of funding options. Your State Farm® agent can help. With an education savings plan from State Farm, you can get your student started on the path to higher learning. Contact an agent to learn more or open an education savings plan.

Contact an Agent

for details or to open an account

529 College Savings Plans

For most colleges nationwide

Coverdell Education Savings Account (ESA)

Save for Kindergarten through grad school

Custodial Accounts (UGMA/UTMA)

Give the gift of college

Importance of Saving & Creating an Education Savings Plan

  • College costs keep rising. In 2016-2017, tuition and fees for in-state students at public, 4-year colleges and universities increased 2.4%. This followed an increase of 2.9% in 2015-2016. 1
  • Every dollar saved is one less dollar borrowed. Student loan debt is now higher than both credit card and auto loan debt, and second only to mortgage loan debt. 2 Plan ahead to help your student graduate without overwhelming debt.
  • It's never too early to start saving for education. With regular contributions into the right plan, and the benefit of both compound interest and potential tax advantages, even modest amounts can grow significantly over time.

Why State Farm?

Along with a range of education savings plans and funding options to choose from, you also have a State Farm agent to work with. Someone to help simplify the terminology, explain your choices and tailor a plan that can get your family's hopes for higher education to a better state. Contact an agent to learn more or open an education savings plan.

Let's Compare Plans

FDIC Insured Bank Education Savings Plan Options

  Coverdell ESA Custodial Account (UTMA)
The account is designed to ... Pay for education – from K-12 to college, graduate school, vocational school, etc. Enable gifting after-tax dollars to a child without establishing a trust.
Tax advantages Tax-deferred growth and withdrawals are tax free if used for qualified higher education expenses and qualified elementary and secondary education expenses. All or a portion of the investment income may be eligible to be taxed at the child's tax rate. For 2017, investment income in excess of $2,100 may be taxed at the parents' tax rate instead of the child's tax rate.
Contribution limits $2,000 per year/per child. No limit on contributions, but gift taxes may apply on contributions over $14,000 per year ($28,000 per couple).
Account controlled by Adult until student reaches age of majority (18)*, but adult may opt to maintain control. Adult until student reaches age of majority (21)*.
Restrictions on how old the student is when contributions are made Checked Checked
Income restrictions Checked
Funds must be used for education to avoid taxation and penalty Checked
Student/beneficiary can be changed Checked
Low impact on financial aid** Checked
Ready to learn more? Coverdell ESA Custodial Account

*This account will be governed and administered in accordance with Illinois law to the extent not preempted by Federal law.
**Neither State Farm nor its agents provide investment, tax or legal advice. Consult your investment, tax or legal advisor regarding your personal situation.

Mutual Fund Options

  529 College Savings Plan Coverdell ESA Custodial Account
(UGMA/UTMA)
The account is designed to ... Pay for higher education expenses – college, graduate school, vocational school, etc. Pay for education – from K-12 to college, graduate school, vocational school, etc. Enable gifting after-tax dollars to a child without establishing a trust.
Tax advantages Tax-deferred growth and withdrawals are free from federal (and possibly state) income tax if used for qualified higher education expenses. Tax-deferred growth and withdrawals are tax free if used for qualified higher education expenses and qualified elementary and secondary education expenses. All or a portion of the investment income may be eligible to be taxed at the child's tax rate. For 2017, investment income in excess of $2,100 may be taxed at the parents' tax rate instead of the child's tax rate.
Contribution limits Varies by plan, but many plans allow in excess of $300,000 over the life of the plan. $2,000 per year/per child. No limit on contributions, but gift taxes may apply on contributions over $14,000 per year ($28,000 per couple).
Account controlled by Adult Adult until student reaches age of majority, but adult may opt to maintain control. Adult until student reaches age of majority.
Restrictions on how old the student is when contributions are made Checked Checked
Income restrictions Checked
Funds must be used for education to avoid taxation and penalty Checked Checked
Student/beneficiary can be changed Checked Checked
Low impact on financial aid Checked Checked
Ready to learn more? 529 College Savings Plans Coverdell ESA Custodial Account (UGMA/UTMA)

1The College Board, Trends in Higher Education, Average Published Undergraduate Charges by Sector, 2016-2017

2fool.com, May 8, 2016

State Farm Bank, F.S.B., Bloomington, Illinois ("Bank"), is a Member FDIC and Equal Housing Lender. NMLS ID 139716. The other products offered by affiliate companies of State Farm Bank are not FDIC insured, not a State Farm Bank obligation or guaranteed by State Farm Bank, and subject to investment risk, including possible loss of principal invested. The Bank encourages any interested individual(s) to submit an application for any product(s) offered by the Bank. We also encourage you to obtain information regarding the Bank's underwriting standards for each type of credit or service offered by visiting statefarm.com or by contacting the Bank at 877-SF4-BANK (877-734-2265). Callers who are hearing or speech impaired should dial 711 or use a preferred Telecommunications Relay Service. To apply for a Bank product, you may also see your participating State Farm agent.

State Farm Bank, F.S.B., Bloomington, Illinois offers deposit and loan products. Other insurance, securities or investment products are offered by affiliate companies. State Farm Bank ("Bank") is a Member FDIC and Equal Housing Lender. NMLS ID 139716. The other products offered by affiliate companies of State Farm Bank are not FDIC insured, not a State Farm Bank obligation or guaranteed by State Farm Bank, and subject to investment risk, including possible loss of principal invested. The Bank encourages any interested individual(s) to submit an application for any product(s) offered by the Bank. We also encourage you to obtain information regarding the Bank's underwriting standards for each type of credit or service offered by visiting statefarm.com or by contacting the Bank at 877-SF4-BANK (877-734-2265). Callers who are hearing or speech impaired should dial 711 or use a preferred Telecommunications Relay Service. To apply for a Bank product, you may also see your participating State Farm agent.

Mutual Funds Risk Disclosure

Investing involves risk, including potential for loss.

AP2017/03/0128