North Dakota 529 Plan Rules And College Savings Options
North Dakota has a 529 plan called College SAVE that can help you save for college. North Dakota doesn't have a state ABLE plan.
If you live in North Dakota, these might be good options for you to save for college.
These programs are designed to help make college more affordable - so that you can get the education you need. By saving for college early on, you can make paying for college easier down the road.
If you're not quite sure how 529 plans work, check out this starter guide to What Is a 529 Plan?
There is also a specific order of operations to save for college that we recommend families follow. These programs are specific to the State of North Dakota. Each state has different rules when it comes to 529 plan savings. Here are the North Dakota 529 plan rules.
Average Cost Of College In North Dakota
When saving for college in North Dakota, it's important to take into consideration the cost of attendance in the state. If you choose to go to an out-of-state school, you need to look at the average cost of attendance in that state.
There are 27 colleges and universities in the State of North Dakota.
The total average cost of college (Cost of Attendance) in North Dakota for in-state residents is $15,530 for 2023. This includes tuition, room and board, books and supplies, and other expenses.
For just tuition alone, the average undergraduate tuition for in-state residents is $6,793 for 2023. The cost of tuition in North Dakota has been flat the last several years.
See how this compares to the average cost of college here. Keep in mind the average student loan debt by graduating class here.
Explore the data here.
North Dakota 529 Plan Tax Information
Tax savings is one of the big benefits of using a 529 plan to save for college. On a federal-level, there is no tax savings for contributions, but qualified distributions are tax-free.
Here are the special tax benefits and considerations for using a 529 plan in North Dakota.
Contributions
North Dakota offers a state tax deduction for contributions to a 529 plan of up to $5,000 for single filers and $10,000 for married filing jointly tax filers.
Minimum: $25
Maximum: Accepts contributions until all account balances for the same beneficiary reach $269,000.
Matching Contributions: The New Baby Match program provides resident children 12 months or younger to be considered for a grant in the amount of $200. New Baby Match participants must enroll in CollegeSAVE and contribute $200 prior to the child's first birthday to qualify for the match.
Rollovers
North Dakota follows federal tax treatment of rollovers.
Qualified Distributions
Qualified distributions from a North Dakota and non-North Dakota 529 plan are tax-free.
K-12 Education
North Dakota does conform with Federal law in regard to using a 529 plan for K-12 tuition. See this guide: Using a 529 Plan For Elementary and High School Private Education.
Student Loans
North Dakota does conform with Federal law for using a 529 plan for student loans.
Rollover To Roth IRA
North Dakota does allow the rollover to a Roth IRA up to $35,000. Learn more about the requirements to rollover a 529 plan to a Roth IRA here.
Non-Qualified Distributions Taxes, Penalties, Recapture
A non-qualified withdrawal from a North Dakota 529 plan is only subject to federal taxes and penalties.
North Dakota 529 College Savings Plan Options
North Dakota has several 529 plan options - one consumer plan and one plan that is sold by financial advisors (we're big advocates of doing-it-yourself, you don't need to pay a financial advisor for this).
College SAVE
College SAVE is the name of North Dakota's 529 Plan. This plan offers a variety of investment options, including age-based portfolios that become more conservative as the child approaches college, and static investment fund options.
The funds offered include Vanguard.
Fees:
There is a $20 annual maintenance fee for non-North Dakota residents.
There is a program management fee of 0.44% to 0.46%.
The underlying funds all charge expense ratios from 0.02% to 0.04% depending on the investment option.
Who Should Use It:
We recommend that North Dakota residents use the College SAVE plan due to the tax benefits, low fees, and plan investment options.
We recommend that out-of-state residents utilize other plans.
North Dakota 529 Able Plan Options
529A Able accounts are accounts designed to help those with disabilities escape poverty and save for themselves. Learn more about 529A Able Plans here.
North Dakota is one of the few states that doesn't operate an ABLE program.
Other Programs To Save For College
A 529 plan is one way to save for college. Remember, we have a full guide on our approach to college savings here - and it helps you find other options.
If you're looking for ways to boost your college savings, check this out:
Backer
Backer is one of our favorite ways to save for college because they make gifting for college so easy. You can setup an account, link your 529 plan (in most states), and get a unique URL that you can share with friends and family to save for your children's college.
Plus, they have Backer Bucks, which allow you to earn rewards and rebates for the shopping you already do - directly deposited into your children's 529 plan.
Upromise
Upromise is another awesome tool to help you save for college because they have a lot of ways that you can earn money for your 529 plan. You can get rebates and rewards, and you can get cash back into your child's 529 plan by using the Upromise credit card.
North Dakota Financial Aid
Using a 529 plan isn't the only way to save money for college. Each state typically offers a variety of financial aid programs for their residents. These include scholarships and grants, and sometimes unique forgivable student loan opportunities.
Check out the list of North Dakota Student Loan and Financial Aid Programs.
Return to the full list of 529 Plans By State.
Editor: Clint Proctor Reviewed by: Mark Kantrowitz
