What to believe about 529s.

Myth: Money in a HI529 account can only be used at schools in Hawai'i.

Truth: You can use the assets in your HI529 account at any eligible 2- and 4-year college, graduate school (including law school and medical school), and vocational/technical school.1

Myth: You can only use a 529 account to pay for college tuition.

Truth: You can use your HI529 account assets for many qualified higher education expenses, including tuition, fees, computers, and certain room and board costs.2

Myth: It costs a lot to open and maintain a 529 account.

Truth: You can open a HI529 account with as little as $15. Additional contributions to your account can be made at any time. The minimum additional contribution amount is $15.

Myth: You have to make a lot of investment decisions.

Truth: With a HI529 account, you can be as hands-on or hands-off as you want to be. You can choose from an Age-Based Option that automatically adjusts its investments as your child nears college or from Individual Portfolios that help you design your own custom portfolio.

Myth: It's too late to start a 529 plan.

Truth: Even if your student is already in high school, you can benefit from a 529 plan. Earnings grow federal tax-deferred, and when you withdraw the money for qualified higher education expenses, it is free of federal tax.2 Any assets not used may even be rolled over to another eligible family member's account.

Myth: If your child doesn't go to college, you lose your money.

Truth: You may withdraw money from your 529 account at any time.3 You can also change your beneficiary to another eligible Member of the Family4 with no tax penalty.

Myth: It's difficult to open a 529 plan account.

Truth: It's fast and easy to enroll online at www.hi529.com. The easy-to-follow directions will guide you through the enrollment process. In as little as 10 minutes, you can be fully and securely signed up and saving for college. Or, if you prefer, you can complete and mail us an Enrollment Form.

Myth: It's expensive to save for college.

Truth: With a HI529 account, it's affordable. Total annual asset-based HI529 plan fees are 0.75%. For example, if you invest $1,000, the annual fee would be just $7.50. All non-resident accounts are charged an annual account fee of $20; that fee is reduced to $10 if the designated beneficiary or account owner is a resident of Hawai'i.


1An eligible educational institution is one that can participate in federal financial aid programs.

2Earnings on non-qualified withdrawals are subject to federal income tax and may be subject to a 10% federal penalty tax, as well as state and local income taxes. The availability of tax or other benefits may be contingent on meeting other requirements.

3Earnings on non-qualified withdrawals may be subject to federal income tax and a 10% federal penalty tax.

4Section 529 defines a family member as: a son, daughter, stepson or stepdaughter, or a descendant of any such person; a brother, sister, stepbrother, or stepsister; the father or mother, or an ancestor of either; a stepfather or stepmother; a son or daughter of a brother or sister; a brother or sister of the father or mother; a son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law; the spouse of the beneficiary or the spouse of any individual described above; or a first cousin of the beneficiary. Gift or generation-skipping transfer taxes may apply. Please consult with your tax advisor for further information.


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