This morning parents saving for college woke up to seven new executive orders on education signed by President Donald Trump. Three of these may have an impact on 529 planning and usage:
Order |
What it does |
Why 529 families should care |
Advancing Artificial Intelligence Education for American Youth |
Launches a federal K-12 AI-literacy push.
Creates an AI-Education Task Force and a nationwide “AI Challenge” Directs the Departments of Labor & Education to expand AI-related Registered Apprenticeships within 120 days |
More apprenticeship choices – Since 2020, you can use 529 funds for tuition, fees, books, and equipment required by any Registered Apprenticeship Program. Adding AI occupations will enlarge the list of eligible programs your teen can enter without triggering taxes or penalties. |
Preparing Americans for High-Paying Skilled Trade Jobs of the Future |
Orders Departments of Labor, Commerce, and Education to streamline workforce programs and produce a plan for 1 million new active apprentices
Encourages dual-enrollment pathways that let high-schoolers earn trade credentials |
Trade-school path gets bigger – Expect a spike in new, federally-registered trades programs (electricians, machinists, nursing assistants, etc.). 529 money can already cover qualified expenses at these Registered Apprenticeship Programs, giving non-college-bound students a tax-advantaged funding option. |
Reforming Accreditation to Strengthen Higher Education |
Directs the Education Department to police—or strip—accreditors that impose DEI mandates.
Re-opens the door for new accreditors and demands outcome-based metrics. |
Check accreditation before you pay – A college must be accredited by a federally recognized agency and participate in Title IV aid to be “eligible” for 529 withdrawals. If an institution’s accreditor loses recognition, the school could fall off the eligible list. Families should confirm a school’s status each year, especially with smaller or specialized programs. SFC’s database will be updated as changes roll out. |
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Practical Takeaways for Parents
- Map out multiple paths. College isn’t the only qualified use of a 529. If your child might choose an apprenticeship—particularly in AI or a skilled trade—these orders expand the universe of programs you can fund tax-free.
- Stay accreditation-aware. Before sending a payment from a 529 account, verify that the school (or future transfer choice) is still eligible. Accreditation changes can take months or years, so keep informed.
- Keep receipts. For apprenticeships, the IRS requires that qualified expenses be required by the Registered Apprenticeship program. Save the program’s tool-list or tuition statement in case you ever need to prove the expense in an audit.
- Watch for new state perks. States often mirror federal priorities. New matching grants or tax incentives could appear for AI or trade pathways.
Bottom line: 529 plans remain the most flexible, tax-efficient way to fund your child’s future—whether that’s a four-year university or an in-demand trade with an AI twist. Keep your options open, stay informed, and let Saving For College guide you through each change.
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