Education Savings Options
Saving for Education
Whether you’re looking to set aside funds for primary, secondary or higher education, we offer a number of options that can help you reach your education savings goals faster.1
Benefits
- Grow savings tax-free
- Use for qualified K-12 and higher education expenses
- Supplement with a 529 Plan
Explore Our Accounts
Education Savings Account (ESA)
Perfect for early and long-term savers, a Navy Federal Coverdell Education Savings Account (ESA) allows you to earn dividends and grow your education savings tax-free.
Education Money Market Savings Account
With an ESA Money Market Savings Account (MMSA), you get all the perks of a basic savings account but with higher rates—meaning the greater your balance is, the greater your earnings will be.
Education Certificates
ESA Certificates allow you to craft your education savings plan by earning at a locked-in rate for your choice of term length.
Explore Education Savings Options
All of Navy Federal's education savings plans are Coverdell ESAs. See how they compare to 529 plans in the chart below.
| Coverdell ESA | 529 Plan |
|---|---|
Coverdell Education Savings Accounts (CESA), formerly known as Education IRAs, allow you to make contributions to a tax-advantaged investment account to be used for qualified K-12 and/or college expenses. How Funds Grow/Tax BenefitsFunds in these accounts grow tax-free, and withdrawals are tax-free when used for qualified education expenses before the beneficiary reaches age 30. Contribution Limits$2,000 a year per child Eligible ExpensesCollege expenses include: tuition, fees, books, room and board, and educational computer technology expenses just like with the 529 plan, but also include academic tutoring, special needs services, uniforms and transportation. |
A 529 Plan, available in most states, allows families to invest and grow savings tax-deferred, and then later withdraw those savings tax-free if used toward qualified K-12 and/or college expenses. How Funds Grow/Tax BenefitsEarnings are tax-deferred, and withdrawals for qualified education expenses aren’t subject to federal taxes. Contribution LimitsContribution limit is dependent on the state that operates the 529 plan. Maximum limits range from $235,000 to over $500,000. Eligible ExpensesCollege expenses include: tuition, fees, books, room and board, and educational computer technology expenses. |
Get Started Planning Your Child's Future
Meet with the financial advisors at Navy Federal Investment Services6 to understand how much you need to save and what options—including 529 plans—are available to help you meet your goals.
Want More Information About Saving?
Explore our resources at Navy Federal's Savings Learning Center.
Savings Resources
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College Savings Accounts
Understand the difference in college savings tools with our comparison of ESAs, 529 Plans, Custodial Accounts and Prepaid Tuition.
Learn Moreabout College Savings Accounts -
College Savings Calculator
Develop or fine-tune your education savings plan with our College Savings Calculator.
Learn Moreabout College Savings Calculator -
Savings Rates
Check out our competitive rates on all Navy Federal savings products.
Learn Moreabout Savings Rates
Disclosures
Consult with your tax advisor.
↵Contributions can be made up to the maximum annual deposit amount of $2,000 per child per year.
↵Rates on variable accounts (e.g., Share Savings, Checking, MMSA) may change after the account is open. This APY is accurate as of 05/29/2022. Fees may reduce earnings.
↵A $2,500 minimum balance must be maintained to earn dividends.
↵This APY is accurate as of 05/29/2022. This APY is an annualized rate that reflects estimated earnings based on the dividend rate and frequency of compounding. Dividends compounded daily, credited monthly. Penalties may apply for early withdrawals from certificate accounts. Offering rates may change.
↵Navy Federal Financial Group, LLC (NFFG) is a licensed insurance agency. Non-deposit investments, brokerage, and advisory products are only sold through Navy Federal Investment Services, LLC (NFIS), a member of FINRA/SIPC and an SEC-registered investment advisory firm. NFIS is a wholly owned subsidiary of NFFG. Insurance products are offered through NFFG and NFIS. These products are not NCUA/NCUSIF or otherwise federally insured, are not guaranteed or obligations of Navy Federal Credit Union (NFCU), are not offered, recommended, sanctioned, or encouraged by the federal government, and may involve investment risk, including possible loss of principal. Deposit products and related services are provided by NFCU. Financial Advisors are employees of NFFG, and they are employees and registered representatives of NFIS. NFIS and NFFG are affiliated companies under the common control of NFCU. Call 1-877-221-8108 for further information.
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