California 529 Plan ScholarShare: California College Savings Plan Basics

While we are providing general information about the California 529 plan, please consult the Plan Description and Participation Agreement for more detailed information and facts about the plan.

California 529 Plan: A Smart Way to Save for College

The ScholarShare 529 Plan is California’s official tax-advantaged college savings program designed to help families prepare for the increasing costs of higher education. With its flexible investment options and tax deferred benefits, ScholarShare 529 is a valuable tool for parents, grandparents, and other loved ones looking to invest in a child’s future education. 

Tax Advantages of ScholarShare 529

One of the key benefits of ScholarShare 529 is the tax-free growth of contributions. While contributions are made with after-tax dollars, earnings grow tax-deferred, and withdrawals for qualified education expenses are entirely tax-free at both the federal and California state levels. This means that families can maximize their savings without worrying about additional tax burdens when using the funds for eligible educational costs.

California 529 ScholarShare Plan Details

Program Type	Savings
Created	1999
State Agency	The ScholarShare Investment Board (SIB) chaired by the State Treasurer
Tax deduction	None for single filers None for joint filers
Program Manager	TIAA-CREF Tuition Financing, Inc. (TFI)
Program distributor	TIAA-CREF Tuition Financing, Inc. (TFI)
Maximum contributions	Accepts contributions until all account balances in California’s 529 plans for the same beneficiary reach $529,000.
Minimum contributions	Any dollar amount
E-gifting platform	Yes
Enrollment or application fee	None
Account maintenance fee	None
Program management fee	0.06% (includes 0.05% state fee) for Active and Social Choice Portfolios; 0.01% for Passive and Index Portfolios (no state fee); None for the Principal Plus Interest Portfolio.
Expenses of the underlying investments	Ranges from 0.17% to 0.47% for Active and Social Choice Portfolios; 0.05% to 0.17% for Passive and Index Portfolios; None for the Principal Plus Interest Portfolio.
Total asset-based expense ratio	0.06% – 0.53%. None for the Principal Plus Interest Portfolio

Qualified Education Expenses 

Funds in a ScholarShare 529 account can be used for a wide range of qualified expenses, including tuition, fees, books, supplies, and equipment required for enrollment. Additionally, the plan covers room and board for students enrolled at least half-time at eligible institutions.

Investment Options

ScholarShare 529 provides a variety of investment options tailored to different savings goals and risk tolerances. These include Enrollment Year Investment Portfolios, which adjust asset allocations as the beneficiary nears college age, and Risk-Based Portfolios that maintain a fixed investment strategy. Notably, the 2024/2025 Enrollment Portfolio Active is designed for students entering college in those years. ScholarShare 529 also strives to keep costs low, with average asset-based fees of 0.21%, significantly lower than the national average of 0.51% for 529 plans.

Contribution Limits and Gifting Opportunities

There are no annual contribution limits for ScholarShare 529; however, contributions are considered gifts for tax purposes. In 2025, individuals can contribute up to $19,000 per beneficiary for single filers and $$38,000 per beneficiary for married individuals without triggering federal gift tax. Additionally, the IRS allows a five-year front-loading option, enabling contributors to gift up to $95,000 in a single year per beneficiary without incurring gift tax consequences. ScholarShare 529 accounts can be funded by multiple contributors, making it a great option for family and friends to contribute to a child’s education.

Impact on Financial Aid

Funds in a 529 plan owned by a parent or dependent student are treated as parental assets on the Free Application for Federal Student Aid (FAFSA), with a maximum impact of 5.64% on the Expected Family Contribution (EFC). This is a much more favorable treatment than student-owned assets. Furthermore, changes to FAFSA beginning in the 2024-2025 school year mean that withdrawals from grandparent-owned 529 plans no longer count as student income, eliminating previous financial aid concerns related to these accounts.

How to Open a ScholarShare 529 Account

Opening a ScholarShare 529 account is simple and can be completed online in just 15 minutes. There are no application, maintenance, or cancellation fees, making it accessible for all families. Account holders can set up automatic contributions and choose an investment strategy that best fits their savings goals.plan for each child.

ScholarShare 529 Contact Information

For assistance with opening or managing an account, you can contact ScholarShare 529 customer service.

• Phone: 1-800-544-5248 (Monday-Friday, 8:00 AM – 7:00 PM PT)
• Website: www.scholarshare529.com
• ScholarShare Investment Board Address: 901 P Street, Suite 313-B, Sacramento, CA
  95814
  ● Email: scholarshare@treasurer.ca.gov
  ● Phone: (916) 651-6380

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