How 529 Plans Cover Student Loan Debt Repayment

The College Savings Podcast with Fexingo: 529 Plans, Education Funding, and Student Costs · Sep 10, 2026 · 13m · transcript

With student loan balances hovering near one point four trillion dollars, the recent Department of Education rule allowing up to ten thousand dollars in lifetime 529 withdrawals for qualified student loan repayment has changed the game. In this episode, we break down exactly how that rule works, who qualifies as a beneficiary, and the critical tax traps parents need to avoid when using their education savings to pay off debt. We look at the specific interaction between the new federal allowance and state tax deductions, using real-world examples to show how a family might structure a…