A Program of the Tennessee Department of Treasury · David H. Lillard, Jr., State Treasurer

Plan for College

The cost of higher education is on the rise, but saving for college doesn’t have to be a burden. With TNStars, there’s no big upfront investment and you can open an account in as little 15 minutes!

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Why TNStars?

You can feel good about investing in your child’s future with one of the top-performing plans in the country!

Browse our top reasons to save for college with TNStars below and check out our TNStars FAQs for more detailed answers to our most commonly asked questions. When you're ready, open an account in as little as 15 minutes with only $25 to start.

TNStars FAQs Open an Account

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An Introduction to 529 Plans

Industry experts agree that 529 Plans are a good option for investing in the future, so what exactly is a 529 Plan?

A 529 plan is designed to help families set aside funds for future college costs. Operated by a state or educational institution, these plans are named after Section 529 of the Internal Revenue Service Code that created these types of savings plans.

Section 529 plans are open to anyone, regardless of income level, and earnings are not subject to federal income tax when used for qualified higher education expenses.

Check out the Tennessee Financial Literacy Commission’s interactive tutorial on 529 plans and let us help you navigate this important financial journey!

Top Reasons to Save with TNStars

Discover what all the excitement is about!

TNStars is a plan that you can manage yourself, on your own time, in your own home. However, just because you can do everything yourself doesn’t mean you’re alone—quite the opposite in fact!

The program is managed by the Tennessee Treasury Department who monitors the plan's investment options and works to keep costs low so you can save even more.

The key to successful saving is to begin early. TNStars makes it easy to get started and continue to build your savings. It’s easy! You can open an account online in minutes with as little as $25.

We strive to make sure your child has choices when it comes time for them to apply for college. What do we mean when we say “choices?”

“Choices” means that, when you open an account with TNStars, you are not limited in where you use your funds. When your child is ready for college, funds can be used at any school that accepts U.S. Federal financial aid including four-year universities, private colleges, community colleges, technical schools, and even out-of-state schools. Give your child the flexibility to choose their own path, whether that keeps them close to home, or sends them around the world!

We all know that a lot more goes into paying for college than just tuition. Housing, school supplies, textbooks, computers—these all cost money. The money you save through your TNStars account can be used to pay for many expenses that directly support your child’s education, from textbooks to rent to college fees. Learn more about qualified expenses in our frequently asked questions.

TNStars offers multiple investment options and competitive returns. Our experienced team has compiled a portfolio of diverse investment options to meet the needs of families. You can choose an investment option based on your timetable and comfort level with risk. We even offer an age-based option which automatically shifts your investments from more aggressive to more conservative as your child nears college age.

When you give a gift to that special child in your life - whether a grandchild, niece, nephew, godchild or friend’s child - you do it to help them succeed. But that doesn’t mean you shouldn’t enjoy the special tax advantages TNStars offers you.

  • Earnings are tax free when used for qualified higher education expenses
  • TNStars contributions qualify for the annual federal gift tax exclusion
    • While the account holder maintains complete control of the account, contributions are considered a completed gift to the beneficiary.
    • An individual can contribute up to $15,000 per year, per beneficiary without incurring federal gift tax. For joint filers, that doubles to $30,000.
    • You can also “superfund” your TNStars account. Under special rules unique to 529 plans, you can gift a lump sum in a given year--up to $75,000 for individual and $150,000 for joint filers and avoid federal gift tax by making an election to treat the gift as if it were made evenly over a five-year period.

You can get started saving with a 529 Plan in a few easy steps:

  • First, consider who you’re saving for. You can name one beneficiary per 529 account. If you’re saving for multiple beneficiaries, we recommend opening a separate account for each.
  • Think about how much you would like to save and how long you have before it’s time for college. Our savings calculator can help you decide how much you will need when it’s time for college.
  • Decide how you want to invest your contributions. 529 Plans offer a variety of investment options, typically made up of mutual funds. You can even choose an Age-Based investment option which automatically shifts from aggressive to conservative as your beneficiary nears college age.
  • Next, choose how you are going to reach your savings goal. You can choose to make automatic contributions each pay period, contribute a large lump sum or designate special occasions for contributions.
  • Manage your account online by make additional contributions and reallocating your investment options up to two times per calendar year.
  • Watch your money work for you while enjoying tax-free growth!
  • Finally, when it’s time for college, withdraw your funds for tuition, books, room & board and more. With TNStars, you can use your money at any school that accepts federal financial aid including:
  • Four-year Universities
  • Private Colleges
  • Community Colleges
  • Technical Schools
  • Out-of-State Schools