529, Roth IRA, UTMA or brokerage: which is actually worth more?

Unused 529 money

If the 529 has money left after college, some of it may move into your child's Roth IRA with no federal tax. This is what the rules allow with your numbers.

An estimate, not a promise. Contribution dates are estimated from your monthly saving, while the real five-year and 15-year tests use your plan's records, and your child's future earnings and the rules can change. Uses the 2026 IRA limit of $7,500 for every year. A rollover takes the place of your child's own IRA contribution that year. Changing the 529's beneficiary may restart the 15-year clock, and some states tax the transfer even though the IRS does not. Confirm with the plan before moving money.

Find a 529 plan

How to read the result

• Pick the goal that matches your plan. The winner for college is often not the winner for retirement, so the calculator ranks one goal at a time.
• The 529 is built for school. Growth is never taxed when it pays for qualified education, and some states add a deduction. Nonqualified 529 withdrawals generally incur federal income tax and an additional 10% tax on earnings, not the original contributions. Exceptions, such as scholarships or the beneficiary's disability, may remove the additional 10% tax. State taxes and repayment of earlier state tax benefits may also apply.
• A 529 is not only for college. Since 2026, federal law allows up to $20,000 a year per child for K-12 costs, including tuition, tutoring, books and testing, and it covers apprenticeships and some career credentials. States don't all follow the federal rules: some still use the older $10,000 tuition-only limit or tax K-12 withdrawals, and in Pennsylvania the 529 program applies $20,000 while some Department of Revenue guidance still shows $10,000. Check your state before using a 529 for K-12. This calculator does not model K-12 withdrawals.
• If your child skips college, a 529 has more options than cashing out: change the beneficiary to another family member, keep it for graduate school or other qualifying education later, move up to $35,000 to your child's Roth IRA under the rules, or withdraw it with the taxes above. The "No college" scenario shows only the last two.
• The Roth IRA is built for the long run, but only for dollars it is allowed to hold. A child can only contribute what they earn.
• UTMA investments belong to your child. Some investment income may be taxed at your child's rates, but the kiddie tax can cause additional income to be taxed using your rates. Your child eventually gains full control of the account. It suits money that may not go to college. The trade-offs are not about tax: the gift cannot be taken back, the money becomes your child's to spend at 18 to 21 depending on your state, and the federal aid formula assesses it at up to 20% of its value, against up to 5.64% for a parent-owned 529. That is an input to the formula, not a dollar-for-dollar cut in aid.
• Your brokerage account rarely wins on dollars. It wins on control: any amount, any use, any time, and the money stays yours.
• In "Build your mix", the tax-break list shows the room you have left in each break. "Suggest a starting allocation" applies a simple rule, not an optimized or guaranteed best split; where the rest goes is a choice about control, not only tax.

How the math works

• Same investments everywhere. Every account earns the return you set, so the differences come from tax. Real portfolios differ: a 529 age-based fund moves toward bonds as college nears.
• College bills are your total cost minus scholarships, paid in four equal parts at ages 18 to 21. In a mix, the 529 pays first, then the UTMA, your brokerage, and the Roth IRA, each covering the bill after its own tax. That order is a sensible default, not a proven lowest-tax order.
• 529: no tax on growth, and education withdrawals are tax-free. A state deduction is shown as cash saved, up to the yearly limit, and only goes into the account if you tick that box. Leftover cashed out at 22 pays income tax plus the additional 10% tax on the growth only, never on contributions; the 10% is waived on an amount equal to the scholarships you entered. Other exceptions, such as disability, are not modelled. Pennsylvania's deduction applies to contributions to any state's 529 plan, and it is never larger than what you contribute; the calculator does not check that each spouse has enough income for the joint limit, which is why that box asks you to.
• Money already saved: treated as already in the account you choose (in Compare mode, in each account in turn). The "share that is growth" slider sets how much of it is untaxed gain for the UTMA and brokerage. In the 529 it counts as put in today, the cautious case for the five-year rollover rule. Money already in a Roth IRA is entered only in Build your mix and is treated as contributions, which can come out tax-free; a Roth can't take more than your child's earnings each year, so in Compare mode the Roth column starts your existing savings in your brokerage.
• 529 leftover kept to 65: the rollover is a direct transfer from the 529 to a Roth IRA in your child's name; the money can't pass through your hands. Each year the rollover is the smallest of $7,500, your child's earnings that year, what is left of the $35,000 lifetime cap, and money that has been in the plan more than five years, less any IRA contributions your child makes that year. Unused room in one year can't be carried to the next. It starts once the account is 15 years old. Pennsylvania does not tax rollovers made after July 10, 2024. Savings you already have are counted as put in today, the cautious case. Anything still in the 529 at 65 is shown withdrawn with income tax plus the 10% additional tax; changing the beneficiary to another family member, which the calculator does not model, could avoid both.
• Roth IRA: each year's contribution is the smallest of what you put in, your child's earnings, and $7,500. Regular Roth contributions also phase out between $153,000 and $168,000 of modified adjusted gross income (MAGI) for single filers in 2026. The calculator assumes your child files single and uses the earnings you enter as an estimate of MAGI; other income, or a different filing status, changes the limit. 529-to-Roth rollovers are not subject to that income limit. The rest goes to the account you choose (in compare mode, your brokerage). Roth IRA contributions can generally be withdrawn at any time without federal tax or penalty. Withdrawals of earnings before age 59½ may be taxable. Qualified higher education expenses remove the 10% early-withdrawal tax but do not make earnings tax-free, so growth used for college is taxed as income. The calculator assumes contributions are withdrawn before earnings, as IRS ordering rules provide; rollover dollars from a 529 are treated as contributions here, though money that came in by rollover or conversion can have its own five-year rules. Cashed out at 22 for anything else, growth pays income tax plus 10%. Left to 65, it is tax-free.
• UTMA / UGMA: a 1.5% dividend each year, and gains when money is sold. Dividends are treated as qualified, which is true of most dividends from U.S. stock index funds, and gains as long-term. Each year's dividends, gains and the child's own earnings are taxed together. Until 19, or until 24 while a full-time student, the kiddie tax applies (2026 amounts): the child's standard deduction is the larger of $1,350 or earnings plus $450; investment income above $2,700 is taxed at your rate; the rest is taxed at the child's own rate, 0% for long-term income while the child's taxable income, earnings included, stays at or below $49,450, and 15% above. After that, the same 0%/15% rates apply with the full $16,100 standard deduction. The support test, which ends the kiddie tax from 18 if the child's earnings pay more than half of their support, is an option in the 529 details; unchecked, the kiddie tax is assumed to apply. Not modelled: interest income and short-term gains (taxed as ordinary income), state income tax, the 3.8% net investment income tax, and non-qualified dividends from bond or some international funds.
• Your brokerage: dividends are taxed every year and the remaining gain when sold, both at the single gains rate you set.
• Federal aid: balances at 18 are multiplied by the 2026-27 formula's top asset rates: up to 5.64% for a parent-owned 529 and your brokerage, 20% for a UTMA, 0% for a Roth IRA. This is a potential asset assessment before the formula's other adjustments (income, allowances, dependency status), not a predicted loss of aid. Colleges and states use their own methods too.

What is left out

• Inflation in the main figures. Every amount is in future dollars, except the "today" figures at 65, which use the inflation rate you set. The college cost you enter is treated as the total future bill and is not increased further, and 2026 tax amounts and limits are used for every year.
• College payment timing: the bill is paid in four equal parts at 18 to 21, which may differ from when tuition is actually due.
• Fund fees, and differences between specific 529 portfolios.
• Future increases in the $7,500 IRA limit, and the bill in Congress that would remove the $35,000 rollover cap.
• State income tax on investment income, rollovers and non-education withdrawals, including clawback of earlier deductions.
• Kiddie tax details: the child's other income, the support test for 18-year-olds and students, and reporting the child's income on the parents' return.
• Gift tax details: who is giving, gift splitting between spouses, and five-year 529 elections.
• Moving UTMA money into a custodial 529, other uses for 529 leftovers (a sibling, graduate school, up to $10,000 of student loans), Trump accounts, Coverdell accounts, and the rollover result's assumption that the beneficiary never changes.