Latest / The College Savings Podcast with Fexingo: 529 Plans, Education Funding, and Student Costs / 529 Plans as a Cybersecurity Education Funding Tool
Transcript
- Lucas: Let’s start with a number. The Cybersecurity and Infrastructure Security Agency — CISA — estimates there are about 450,000 unfilled cybersecurity jobs in the US right now as of early 2026. Luna: That’s a massive gap. And a lot of those roles don’t require a four-year degree. Lucas: Exactly. And that’s where 529 plans come in — because under the SECURE Act, which expanded qualified expenses a few years back, you can use 529 funds for registered apprenticeship programs and certain trade school costs. Cybersecurity bootcamps and certifications often qualify. Luna: So if someone wants to transition into cybersecurity, they could tap a 529 plan that was originally set up for a traditional college path? Lucas: Yes. But you have to be careful about which programs qualify. The key is that the program must be offered by an eligible educational institution — typically a community college or a trade school that’s accredited and eligible for federal student aid. Some standalone bootcamps might not qualify if they’re not affiliated with an accredited school. Luna: Right. So you need to do your homework. But if it’s through, say, a community college’s continuing education division, you’re probably good. Lucas: Exactly. A lot of community colleges now offer cybersecurity certificate programs that run 20 to 30 weeks. Total cost might be $5,000 to $15,000 — much less than a semester at a four-year school. And you can pay for tuition, books, even a laptop if it’s required. Luna: And the certifications themselves — like CompTIA Security+ or Certified Information Systems Security Professional, CISSP — those are often the entry ticket to a job. Lucas: Right. And if the certification exam is part of a course at an eligible institution, the exam fee counts as a qualified expense. But if you just sign up for the exam on your own, without a course, that’s not covered. Luna: Good distinction. So the structure matters. Lucas: Yeah. And there’s another angle — if your child is in high school and you want them to start building cyber skills early, some states allow 529 funds to cover dual enrollment courses. Those can include cybersecurity fundamentals at a local college. Luna: I didn’t know that. So you could start using the 529 before they even graduate high school. Lucas: Yes. And if they earn a certification while still in high school, they’re that much further ahead. The Bureau of Labor Statistics projects cybersecurity analyst roles will grow 32 percent through 2032 — much faster than average. Luna: So this feels like a smart pivot for families who are worried their kid might not need or want a traditional four-year degree. Lucas: Totally. And 529 plans are flexible — you can change beneficiaries to a sibling, a cousin, even yourself. So if you’re a parent thinking about a career change, you could use your own 529 funds for a cybersecurity bootcamp. Luna: Wait — self-directed use? I thought 529s were for kids. Lucas: They are primarily for children, but the account owner can name themselves as beneficiary. So if a parent wants to reskill, they can. Of course, you lose some state tax benefits if you withdraw for yourself in some states, but the federal tax-free growth still applies if used for qualified expenses. Luna: That’s a powerful option. Especially for someone in their 40s or 50s looking to move into a growing field. Lucas: Right. And the cost of a cybersecurity bootcamp is often a fraction of a master’s degree. So it’s an efficient use of 529 dollars. Luna: Let’s talk about a concrete example. Say someone has a 529 plan with $20,000 saved for a child who decides not to go to college. Can they just switch beneficiaries to themselves and use it for a bootcamp? Lucas: Yes. They’d change the beneficiary to themselves, then enroll in a qualifying program. The withdrawal would be tax-free as long as it’s for a qualified expense. But they need to check if their state recaptures any previous tax deductions — some states do. Luna: So the planning piece is important. Don’t just pull the trigger without understanding the state implications. Lucas: Exactly. And a related point — if the bootcamp is online, that’s fine. The SECURE Act clarified that online programs at eligible institutions qualify. So you could take a fully remote cybersecurity course and still use 529 funds. Luna: That opens up a lot of possibilities. Especially for people in rural areas or those who need flexibility. Lucas: Yes. And one more thing — room and board can be covered, but only if the student is enrolled at least half-time. For a short bootcamp, that might not apply. So tuition and required equipment are the main items. Luna: Good to know. So not a full living-expense fund, but the core costs are covered. Lucas: Right. And the market is responding — some 529 plans now specifically market themselves as career-training accounts, not just college savings. It’s a shift in perception. Luna: I think that’s smart. The whole point is to help people gain skills, whether that’s at a university or a trade school. Lucas: Exactly. And cybersecurity is just one example. The same logic applies to any accredited trade program — welding, HVAC, medical coding. But cyber has that extra growth story. Luna: Before we move on — I want to mention something. A few listeners have asked how we keep making these episodes without ads or sponsors. Lucas: Yeah, it’s a good question. The short answer is that a small group of listeners chips in monthly through buy me a coffee dot com slash fexingo. That’s what covers production costs. Luna: It’s not a big ask — just that if you’ve gotten value from our conversations, that’s a way to keep them going. No pressure. Lucas: And it helps us stay independent, so we can cover niche topics like this without worrying about ad revenue. Luna: Alright, back to the cyber track. One thing we haven’t touched on — what about using 529 funds for a certification that’s not through a school, like a self-study exam? Lucas: That’s tricky. The IRS has said that expenses must be for a course of instruction at an eligible institution. A standalone exam fee doesn’t qualify. But if you take a prep course at a community college that includes the exam, then it’s covered. Luna: So the wrapper matters. The course, not just the credential. Lucas: Exactly. And some bootcamps have partnerships with colleges specifically to make them eligible. It’s worth asking the provider if their program is Title IV eligible — that’s the federal student aid standard. Luna: Good tip. Alright, final thought — if you’re a parent or a career-changer, what’s the first step? Lucas: First, look at your current 529 plan — see what state you’re in and what the rules are. Then research eligible cybersecurity programs in your area. Many community colleges list them online. And if you don’t have a 529 yet, opening one with a modest contribution can still be worthwhile for future training. Luna: And the job market is hot — so the ROI could be strong. Lucas: Exactly. It’s a way to use a savings vehicle for a real-world need. And that’s the whole idea.