Can Two Separate 529 Plans Be Merged Together?

Section 529 plans are programs used by families to save for qualified higher-education expenses. These plans have no income limitations. They also feature tax advantages and minimal impact on financial aid eligibility. Assets can be merged from one 529 plan to another in a process known as a rollover.


The Section 529 plan was created by Congress by way of the Small Business Job Protection Act in 1996. Section 529 plans are also called qualified tuition programs and are referred to as 529 plans because of the Internal Revenue Service code that governs them.


The two types of 529 plans are college savings plans and prepaid tuition plans. Prepaid tuition plans are programs that allow individuals to prepay part of the tuition or the entire tuition with contracts (a fixed number of semesters or years of tuition) or units (a specified percentage of tuition) to use for qualified college expenses. The contracts or units are used for costs at in-state public colleges only.

The Independent 529 plan is another type of prepaid arrangement used for tuition and fees at private colleges.

529 college savings plans are composed of a variety of investment offerings such as mutual funds, which are not guaranteed or insured by the Federal Deposit Insurance Corp.


You can save money by merging two separate 529 plans since you avoid paying two separate groups of maintenance fees. If you are merging two 529 college savings plans, you can possibly earn additional investment income since you have invested additional funds.


The investments and options between the 529 programs you currently hold should be evaluated prior to merging both 529 plans or requesting a rollover from one 529 program to another. If you sell your 529 college savings plan investments, you could potentially sell at a loss since you are redeeming the assets.

Time Frame

It usually takes a week to two weeks to successfully roll over or consolidate the assets from two separate 529 programs.