Trump’s ‘big beautiful bill’ makes 529s lifelong learning accounts
The new rules expand how tax-advantaged 529 savings plans can be used to pay for expenses outside of college and unlock money that employees can use to advance or change careers.
Under the provisions of President Donald Trump’s Big Beautiful One Bill, signed into law in July 2025, you can use a 529 plan to save not only for your child’s education but also for your own career training or professional knowledge.
“Now you can actually use these as lifelong education savings accounts,” said Vivian Tsai, managing director of TIAA Education Savings. He said the changes were “hugely transformational for adult learners.”
TIAA is the third-largest program manager with 529 plans, with $83.5 billion in assets as of March 31, according to compiled data. ISS Market Intelligence.
How to get the most out of a 529 plan?
Nathan Sebesta teaches his daughter about money.
Courtesy: Nathan Sebesta
Certified financial planner Nathan Sebesta, owner of Access Wealth Strategies in Artesia, New Mexico, said he began using funds from his 529 plan in 2020 to help pay for his master’s degree in financial planning. He later changed the beneficiary of the account to his daughter.
He now advises his clients to consider using money from their 529 account for classes and programs to help them change careers or grow in their field.
“If someone is already spending $1,000 or $2,000 to pursue education, that makes sense,” he said. “They can pre-fund it monthly. By the time that expense occurs, it’s already included in the 529 plan and ready to go.”
More workers may need to unlock 529 plan balances when facing layoffs or job transitions, said Steve Chen, CEO of digital financial planning platform Boldin.
“Some people will then have to retrain and reskill, and so having the ability to leverage tax-efficient dollars to fund ongoing lifelong education makes a lot of sense,” he said.
Make sure you choose a qualified program
But experts say 529 funds cannot be withdrawn for any AI bootcamp or online certification program.
“Always read the fine print,” said Jeffrey Judge, CFP, with Chesapeake Financial Planners in Forest Hill, Maryland. He said he had a client who used a 529 plan to get a project management certificate at a community college, only to discover that a coding program he was interested in wasn’t a good fit.
The new law requires 529 funds to be used for credentials and programs authorized under the federal Workforce Innovation and Opportunity Act or national credentialing organizations. A 529 account can also be used to withdraw money to earn licenses issued or recognized by a state or federal agency.
“If it’s something that just started last year and has no affiliation with known associations in the industry, you might want to be a little more careful,” said Martha Kortiak Mert, chief operating officer of Saving for College, which is part of 529 plan-focused fintech company Backer.
BECOME A MEMBER: Money 101 is an eight-week learning course on financial freedom delivered weekly to your inbox. become a member Here. Also available at: Spanish.
