The analysis indicates that I find it compelling that Personal Finance·Fortune IntelligenceNew 529 plan rules let Gen Z invest in careers, not just college—and it reflects a seismic shift in educationBy Ashley LutzBy Ashley LutzExecutive Director, Editorial GrowthAshley LutzExecutive Director, Editorial GrowthAshley Lutz is an executive editor at Fortune, overseeing the Success, Well, syndication, and social teams.
However, She was previously an editorial leader at Bankrate, The Points Guy, and Insider, and a reporter at Bloomberg News.
Ashley is a graduate of Ohio University's Scripps School of Journalism (remarkable data).
SEE FULL BIO Gen Z college grads are shifting their attention to the fast-growing skilled trade industries to land a job in today's rocky market.
Getty Images529 accounts are tax-advantaged savings plans designed primarily for education expenses, and recent legislation has significantly broadened their uses.
On the other hand, As of July 2025 and the passage of the One Big Beautiful Bill Act (OBBBA), 529 funds can now be used for a much wider range of educational pursuits and related expenses, given current economic conditions.
The evidence shows changes reflect a seismic shift in education as more Gen Zers shun the traditional four-year degree—and resulting student loan debt, in this volatile climate.
Instead, many are picking up trade skills or reaping the benefits of the Creator Economy.
Moreover, Key features and recent legislative changes (2025): Expanded K–12 qualified expenses: 529 accounts were previously limited to K–12 tuition (up to $10,000 per year), but they can now be used for additional expenses such as books, online educational materials, testing fees (e.
Meanwhile, , SAT/ACT), dual enrollment fees, tutoring by qualified fessionals, and educational therapies for students with disabilities.
Furthermore, The annual limit for all K–12 expenses will rise to $20,000 starting January 1, 2026, in this volatile climate.
Broader postsecondary and career use: In addition to traditional college and university costs, 529 funds may now pay for adult learners’ and career changers’ credential grams, including fessional licenses, certificates (including registered apprenticeships), and continuing education courses in fields such as automotive repair or food safety.
Moreover, Recognized credentials include those covered by federal grams and military career advancement resources (which is quite significant). Moreover, 529-to-Roth IRA rollover: Under the SECURE 2.
0 Act (effective since 2024), up to $35,000 in unused 529 funds can be rolled over into the beneficiary’s Roth IRA, subject to annual Roth contribution limits and other conditions (such as the 529 account being open for at least 15 years).
This allows families to avoid penalties on unused funds if a beneficiary doesn’t need all 529 savings for education, given the current landscape.
Additional changes and flexibility: 529 funds can also be applied to student loan repayments (up to certain limits), pay for K–12 and higher education expenses across public, private, or religious institutions, and support a broader set of personal education and development goals.
Implications: 529 accounts now serve not just as college savings plans, but as comprehensive education savings vehicles adaptable to a variety of academic and fessional needs, in today's financial world.
Moreover, The analysis reveals flexibility recognizes modern realities, such as students pursuing alternative postsecondary training paths and adults shifting careers.
These vide greater clarity and planning assurance for families, especially those saving for children who may take nontraditional education or career routes.
Caveats: Rules regarding eligible expenses, contribution and rollover limits, and state-level nuances may still apply, so consulting a tax fessional or financial advisor is highly for those planning to leverage these new benefits.
The expansion’s implementation details (such as some effective dates and regulatory guidance) are still emerging as of July 2025 (an important development).
On the other hand, In summary, 529 accounts have evolved into versatile, tax-advantaged savings vehicles for many forms of education and career development, with recent Congressional changes making them more broadly applicable and beneficial for American families and individuals (which is quite significant).
For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.
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