18 States Offer FDIC-Insured 529 Plan Options
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By Kathryn Flynn

May 6, 2019

18 states offer 529 plan options that are insured by the Federal Deposit Insurance Corporation (FDIC), including high yield savings accounts and bank certificates of deposit (CDs). FDIC-insured investments are suitable for families who want to preserve capital in their 529 plan without taking on excess risk.

What are FDIC-insured investments?

FDIC-insured investments are backed by the full faith and credit of the United States government up to certain limits in the event of a bank failure. This is an attractive feature for families with a short time horizon to invest. If a student is approaching college or has already started college, they can take advantage of the tax benefits and flexibility of a 529 plan without risking their principal investment. The same strategy works for families who use a 529 plan to pay for K-12 tuition.

FDIC-insured options within 529 plans are also a good option for families who are risk-averse. For example, parents and grandparents who witnessed their retirement accounts or other savings get wiped out by the Great Recession may be hesitant to leave their child’s education fund at the mercy of volatile stock and fixed-income markets.

The states listed in this table offer at least one FDIC-insured investment option within a 529 plan. Two additional 529 plans offer similar investment options that are not FDIC-insured:

  • North Carolina’s National College Savings Program offers the Federally-Insured Deposit Account, which is insured by the National Credit Union Administration (NCUA)
  • Wisconsin’s Edvest 529 plan also offers CD investment options, but they are not FDIC-insured

States that offer FDIC-insured investment options within 529 plans

State529 PlanFDIC-Insured Investment Option
ArkansasGIFT College Investing PlanGIFT Plan Savings Portfolio
iShares 529 PlanSavings Portfolio
ArizonaAFCSP – Bank PlanSavings Account
Fidelity Arizona College Savings PlanAZ Bank Deposit Portfolio
ColoradoSmart Choice College Savings PlanMoney Market Savings Account
DelawareDelaware College Investment PlanDE Bank Deposit Portfolio
IdahoIdaho College Savings ProgramSavings Portfolio
IndianaCollegeChoice Advisor 529 SavingsSavings Portfolio
CollegeChoice CD 529 Savings PlanSavings Account
CollegeChoice 529 Direct SavingsSavings Portfolio
KentuckyKY Saves 529Capital Preservation Option
MassachusettsU.Fund College Investing PlanMA Bank Deposit Portfolio
MaineNextGen College Investing Plan – Client DirectNextGen Savings Portfolio
NextGen College Investing Plan – Client SelectNextGen Savings Portfolio
NebraskaNebraska Education Savings Trust – AdvisorBank Savings
Nebraska Education Savings Trust – DirectBank Savings
State Farm College Savings PlanBank Savings
New HampshireUNIQUE College Investing PlanNH Bank Deposit Portfolio
NevadaSSGA Upromise 529Savings Portfolio
OhioCollegeAdvantage Direct 529 Savings PlanFifth Third 529 Savings Account
OregonOregon College Savings PlanFDIC-Insured Option
South CarolinaFuture Scholar 529 College Savings Plan – AdvisorColumbia Bank Deposit 529 Portfolio
Future Scholar 529 College Savings Plan – Direct SoldFuture Scholar Bank Deposit Portfolio
TennesseeTNStars College Savings ProgramTN First Interest Bearing Account
Utahmy529FDIC-Insured Option
VirginiaInvest529FDIC-Insured Option

Source: 2019 FDIC-Insured Products in 529 Plans, Savingforcollege.com

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