Fiction: My child has to go to school in the state offering the 529 plan I invest in.
Fact: 529 plans are portable. You can use your 529 plan savings for qualified higher education expenses at almost any school in any state and even in some study-abroad programs, as long as you choose a school that has been accredited for financial aid programs. In other words, you can live in Maine, open a 529 plan in Iowa, andlet your child go to school in Texas and still enjoy the federal tax benefits that go along with 529 plans.* But check the plan offered in your home state first, because many state plans offer financial advantages for residents.