The 529 plan is an education savings plan for children initiated by American states, which is named after its provision number in the Internal Revenue Code of 1986.

Since 1996, the 529 program aims to help students pay for their education. Initially, it can only pay for children's education above middle school. Later, according to the Tax Cuts and Jobs Act, it was expanded to cover all the costs of K-12 education (basic education in the United States).

It includes two basic types: prepaid tuition plans and savings plans. The prepaid tuition plan allows plan holders to pay the beneficiary’s tuition and fees in advance at the designated institution. A savings plan is a tax-preferential investment tool similar to IRA (U.S individual retirement account, which can be used for savings and financial management).

The governments of various states can formulate different plans and select qualified asset management companies for management. Investors open the 529 account in these companies according to the account functions agreed in advance by each state, and they become the owner of the account, and can designate the beneficiary of the account.