Minnesota Families Can Take Advantage of a Triple Tax Benefit with MNSAVES

published February 26, 2024

St. Paul, Minn. (February 26, 2024) – Families who invest with MNSAVES, Minnesota’s 529 College Savings Plan, can benefit from a triple tax benefit that can potentially help save thousands of dollars each year in taxes. There are three ways to save once a Minnesota resident has opened and contributed to a MNSAVES account:

  1. Account owners may qualify for a state tax deduction of up to $3,000 for married joint filers or $1,500 for those filing single
  2. Tax-deferred growth on any earnings
  3. Tax-free withdrawals for qualified higher education expenses such as tuition, fees, room and board, books, and more

Some Minnesota taxpayers may be eligible for a tax credit of up to $500 (subject to phase-out based on certain federal adjusted gross income thresholds).

"Our goal is to keep money in the pockets of Minnesotans," said Jim Mandler, senior marketing manager for MNSAVES. "The less you pay in taxes, the more you can potentially save for higher education. We hope this triple tax benefit makes it easier for families to reach their college savings goals."

With the rising cost of tuition, saving for college has never been more important. For public 4-year college and universities, the 5-year average tuition inflation rate is 17 percent, while for non-profit private institutions average tuition increased by 13 percent.1 At Minnesota four-year colleges, it now costs $20,750 annually for public, in-state tuition and living expenses, $44,026 annually for private according to Collegetuitioncompare.com, 2023.

In addition to tax savings, MNSAVES is a Morningstar medalist. In 2023, MNSAVES received a Silver Analyst Rating from Morningstar, an independent investment research and management firm. The independent analysts at Morningstar carefully reviewed the merits of 54 different 529 plans and recognized MNSAVES with a Silver Rating for the fifth year in a row. MNSAVES has maintained its rating, noted by Morningstar for its low fees, high-quality investment strategies and the state’s strong oversight.

According to the analyst report, "A forward-thinking approach implemented by a dedicated 529 team supports a Morningstar Medalist Rating of Silver for the Minnesota College Savings Plan." The sharp state board of investments and low cost add to this plan's appeal. The report further states, "The straightforward and well-diversified portfolios continue to make this plan compelling."

Setting up an MSAVES account can be fast and easy. In as little as 15 minutes and $25 you can start saving for college.

For more information about MNSAVES or to open an account, visit mnsaves.org. MNSAVES is also on Facebook and Instagram.

When visiting the website at mnsaves.org, register for the MNSAVES Smart Savings Sweepstakes for a chance to win $529 toward a new or existing account. The sweepstakes runs through March 31, 2024. (No purchase necessary/void where prohibited). The Smart Savings Sweepstakes is sponsored by TIAA-CREF Tuition Financing, Inc.

About the Minnesota 529 College Savings Plan

The Minnesota 529 College Savings Plan (MNSAVES), Minnesota’s official 529 college savings plan, makes it easier for families to save for higher education expenses. Funds saved can be used at eligible colleges and universities, community or technical colleges and graduate schools nationwide and many abroad. In addition to tuition, funds may be used for certain room and board expenses, books, computers, supplies or other qualified expenses.


In an annual review (11/2/2023) of the largest 529 college savings plans (54 plans representing 90% of 529 assets as of August 2023), Morningstar identified 34 plans that stand out above the rest, awarding those plans Gold, Silver and Bronze Morningstar Analyst Ratings for 2023. These plans offer a well-researched asset-allocation approach, a robust process for selecting and monitoring underlying investments, a well-resourced and experienced investment team, stable and engaged oversight from the state and low fees. Investors in what Morningstar analysts consider the best 529 plans should be well-positioned for the future. The four key pillars used by Morningstar to evaluate 529 college savings plans include – Process, People, Parent and Price. For more information about Morningstar’s overview of the Minnesota College Savings Plan, go to Morningstar.com. TIAA-CREF Tuition Financing, Inc. compensates Morningstar for the ability to quote these ratings in public communications. Past performance does not predict future results. Source: Morningstar.com. A Morningstar Analyst Rating for a 529 college savings plan is not a credit or risk rating. Analyst ratings are subjective in nature and should not be used as the sole basis for investment decisions.

To learn more about the Minnesota College Savings Plan, its investment objectives, risks, charges and expenses see the Plan Description at mnsaves.org. Read it carefully. Investments in the Plan are neither insured nor guaranteed and there is the risk of investment loss. Check with your home state to learn if it offers tax or other benefits such as financial aid, scholarship funds or protection from creditors for investing in its own 529 plan. If the funds aren't used for qualified higher education expenses, a federal 10% penalty tax on earnings (as well as federal and state income taxes) may apply. Consult your legal or tax professional for tax advice. TIAA-CREF Individual & Institutional Services, LLC, Member FINRA, distributor and underwriter for the Minnesota College Savings Plan.

Neither TIAA-CREF Tuition Financing, Inc., nor its affiliates, are responsible for the content found on any external website links contained herein.

All social media platforms are managed by the State of Minnesota.


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